Secret Sanction on BofA

http://www.futureofcapitalism.com/2010/08/secret-sanction-on-bofa

The Wall Street Journal has a news article on Bank of America's desire to win release from "a secret U.S. sanction imposed during the financial crisis."

Since Bank of America is a publicly traded company, aren't regulators and bank management depriving the investing public of material information by keeping this memorandum of understanding "confidential"?

The Journal says: "The Charlotte, N.C., lender, for example, isn't allowed to raise its dividend as long as the memorandum hasn't been lifted, said people familiar with the agreement."

Maybe I'm missing something here, but isn't a government memorandum preventing the dividend from being raised something that potential investors would not want to be "secret"?

The Journal article doesn't get into the issue of whether the bank or the government have an obligation to disclose this memo to the investing public.

by Ira Stoll  |  Aug 6, 2010 at 10:41 am Related Topics:  Banking, Capital Markets Regulation, Federal Reserve, Press receive the latest by email: subscribe to the free futureofcapitalism.com mailing list