Thursday, Bank of America Corp. (BAC) announced that it has priced its offering of 1.286 billion common equivalent securities at $15.00 per security. The company expects to collect gross proceeds of around $19.29 billion from the offering.
Bank of America plans to use the proceeds from the offering, together with existing funds, to repurchase the preferred stock issued to the U.S. Department of the Treasury as part of the Troubled Asset Relief Program or TARP.
The Charlotte, North Carolina-based bank said yesterday that it would repay the whole of $45 billion debt that it received under the TARP. The company also said that the repayment will be made after the completion of a securities offering.
Relating to the offering Bank of America previously said that it will fund the TARP repayment by utilizing $26.2 billion in excess liquidity and $18.8 billion in proceeds from the sale of common equivalent securities. Now, the company has raised its offering size to around $19.29 billion.
The company had also said that the $18.8 billion issuance of common equivalent securities would be treated as Tier 1 common capital. The common equivalent securities carry warrants to buy a total of 60 million shares of common stock at $0.01 per share.
The company now said that each common equivalent security consists of one depositary share, representing a 1/1,000th interest in a share of common equivalent junior preferred stock, and a contingent warrant to purchase 0.0467 of a share of common stock for a purchase price of $0.01 per share.
Further, each depositary share entitles the holder to a proportional fractional interest in all rights and preferences of the common equivalent junior preferred stock represented thereby, including conversion, dividend, liquidation and voting rights.
Currently no public market exists for the common equivalent securities, the depositary shares, or the contingent warrants. The common equivalent securities will trade on the New York Stock Exchange under the symbol "BAC PR S."
BofA Merrill Lynch is serving as sole bookrunner. The offering is being made under Bank of America's existing shelf registration statement filed with the Securities and Exchange Commission.
BAC closed Thursday's regular trading at $15.76, up $0.11 or 0.70% on a volume of 651.72 million shares. However, the stock lost $0.29 or 1.84%, and traded at $15.47 in after hours. In the past 52-week period, the stock has been trading in a broad range of $2.53 to $19.10.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.