Thursday, financial services giant Bank of America Corp. (BAC) said that its board has authorized payment of about $713 million in dividend to the U.S. government under the Troubled Asset Relief Program or TARP.
The dividends include a cash dividend of $312.50 per share, or a total of about $188 million, on the Fixed Rate Cumulative Perpetual Preferred Stock, Series N, related to the government's $15 billion investment in Bank of America under the TARP.
The payments also include a cash dividend of $312.50 per share, or a total of about $125 million, on the Fixed Rate Cumulative Perpetual Preferred Stock, Series Q, related to the government's $10 billion investment in Merrill Lynch & Co., Inc. and a cash dividend of $500 per share, or a total of about $400 million, on the Fixed Rate Cumulative Perpetual Preferred Stock, Series R, related to the government's $20 billion investment in Bank of America on January 16, 2009, under the TARP.
All of the three dividend payments are payable on August 17, 2009, to the U.S. Department of the Treasury, the shareholder of record, as of July 31, 2009.
Separately, the Charlotte, North Carolina-based bank's board also authorized dividends on other preferred stock.
During last month, major American banks including Morgan Stanley (MS), JPMorgan Chase & Co. (JPM), Goldman Sachs Group, Inc. (GS), U.S. Bancorp (USB) and BB&T Corp. (BBT), repaid the capital received as bail-out funds under the TARP. One of the major reasons for the banks to quickly repay the money is to free it from restrictions placed by the government. Bank of America, however, was not one among them.
BAC closed Thursday's regular trading at $12.64, down 0.41 or 3.14%, on the NYSE.
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