8-KOther EventsExhibits & Filings

BANK OF AMERICA CORP /DE/ 8-K Report, Corporate Update (Mar 12, 2009)

Filed March 12, 2009For Securities:BACBAC-PBBAC-PKBAC-PLBAC-PMBAC-PNBAC-PSBML-PJBAC-PEBAC-PPBAC-PQBACRPBML-PGBML-PHBML-PLBAC-POMER-PK

Summary

This 8-K filing from Bank of America (BAC) on March 12, 2009, details the company's issuance of new debt securities on March 9, 2009. Specifically, BAC sold $2.5 billion in Senior Three-Month LIBOR Notes due June 2012 and $2.0 billion in 2.375% Senior Notes due June 2012. A crucial detail for investors is that these Notes are guaranteed by the Federal Deposit Insurance Corporation (FDIC) under its Temporary Liquidity Guarantee Program. This issuance signals Bank of America's continued access to funding markets amidst the challenging economic environment of 2009. The FDIC guarantee provides a significant layer of security for bondholders, mitigating concerns about the creditworthiness of the issuer. Investors should note the mix of floating-rate and fixed-rate notes, offering different risk and return profiles.

Key Highlights

  • 1Bank of America issued $4.5 billion in senior notes on March 9, 2009.
  • 2The issuance included $2.5 billion in Senior Three-Month LIBOR Floating Rate Notes due June 2012.
  • 3The issuance also included $2.0 billion in 2.375% Senior Fixed Rate Notes due June 2012.
  • 4All issued notes are guaranteed by the FDIC under the Temporary Liquidity Guarantee Program.
  • 5The company entered into a Written Terms Agreement with initial purchasers for the sale of these Notes.
  • 6The filing includes exhibits detailing the terms of the Notes and the agreement.

Frequently Asked Questions

Bank of America issued a total of $4.5 billion in senior notes. This comprises $2.5 billion in floating rate notes and $2.0 billion in fixed rate notes.

The FDIC guarantee, under the Temporary Liquidity Guarantee Program, significantly enhances the credit quality of these notes. It ensures that in the event of default by Bank of America, the FDIC would cover the principal and interest payments, providing a strong layer of security for investors.

Both the Senior Three-Month LIBOR Notes and the 2.375% Senior Notes have a maturity date of June 2012.

While the company is accessing debt markets, the issuance itself, especially with an FDIC guarantee, indicates the company's ability to secure necessary funding. The challenging economic environment of 2009 made accessing capital difficult for many financial institutions, so this issuance demonstrates continued market access.