Bank of America has agreed to a $7.65 million penalty to settle Securities and Exchange Commission charges stemming from the Charlotte, N.C., bank’s miscalculation of its capital ratios, the SEC said Monday.
The penalty comes after the bank disclosed in April that it had for years been accounting incorrectly for a type of debt it inherited in its 2009 Merrill Lynch acquisition. Bank of America made that disclosure after the bank discovered the error.
The SEC said it charged the bank with violating internal controls and record-keeping provisions of federal securities laws. The bank overstated its capital ratios as a result of “internal accounting control deficiencies” and “books and records failures,” the regulator said.
Bank of America spokesman Jerry Dubrowski declined to comment.
The miscalculations caused the bank to suspend a planned increase in its quarterly common-stock dividend. The bank had planned to raise the dividend from 1 cent per share to 5 cents per share.
Following the discovery of the miscalculations, the bank had to resubmit its request for the dividend increase to the Federal Reserve.
In August, the bank announced it had again won Fed approval to raise the dividend to 5 cents. But the bank said it would scrap plans to buy back $4 billion in common stock, which had been part of its original plan the Fed approved in March.