Fed plans BofA-Countrywide hearings

Public meetings scheduled for next month in Los Angeles and Chicago to generate comments about $4 billion deal.

EMAIL  |   PRINT  |   SHARE  |   RSS
google my aol my msn my yahoo! netvibes
Paste this link into your favorite RSS desktop reader
See all CNNMoney.com RSS FEEDS (close)

NEW YORK (CNNMoney.com) -- Americans will get a chance to speak their minds on the proposed merger between Bank of America and Countrywide Financial Corp., the Federal Reserve said Thursday.

The central bank will hold a one-day hearing in Chicago on April 22 and two days of hearings in Los Angeles on April 28 and 29 on the $4 billion all-stock deal that would transform Bank of America (BAC, Fortune 500) into the nation's largest mortgage lender.

Charlotte-based Bank of America revealed its plans to buy Countrywide (CFC, Fortune 500) in January, after acquiring a significant stake in the embattled mortgage lender late last summer.

The Fed said Thursday it hopes that the hearings will provide some insight into whether the benefits of the acquisition - such as greater convenience for consumers - outweigh the potential costs such as decreased competition.

The hearings, however, are a bit of an unorthodox move for the Fed. Even thought the central bank does have the power to do so, it rarely allows for a public hearing on a proposed acquisition. Before Thursday's announcement, the central bank accepted public comment on the deal, but only in writing.

The last time the central bank sponsored such a hearing was back in March 2004 when regulators allowed the public to weigh in on JPMorgan Chase's (JPM, Fortune 500) bid for the credit card issuer Bank One.

At the time, more than 150 people testified at public meetings held in New York and Chicago, and nearly 300 additional written comments were submitted. Less than 3 months later, the Fed approved the deal.

While comments from next month's hearings could factor into the Fed's decision, the consensus lately on Wall Street and among banking experts is that a tie-up between Bank of America and Countrywide will happen.

When the deal was announced, analysts expected it to face little headwind from federal regulators as the Federal Deposit Insurance Corporation, the government agency that guarantees consumer deposits, would likely have to order a bailout of Countrywide if the company's situation worsened. To top of page

They're hiring!These Fortune 100 employers have at least 350 openings each. What are they looking for in a new hire? More
If the Fortune 500 were a country...It would be the world's second-biggest economy. See how big companies' sales stack up against GDP over the past decade. More
Sponsored By:
10 of the most luxurious airline amenity kits When it comes to in-flight pampering, the amenity kits offered by these 10 airlines are the ultimate in luxury More
7 startups that want to improve your mental health From a text therapy platform to apps that push you reminders to breathe, these self-care startups offer help on a daily basis or in times of need. More
5 radical technologies that will change how you get to work From Uber's flying cars to the Hyperloop, these are some of the neatest transportation concepts in the works today. More


Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.