BoA hid billions of dollars of debt through bad accounting
BANK of America (BoA) has admitted it incorrectly classified figures of up to $10.7bn (£7.1bn) in short-term lending and repurchase deals for mortgage securities as sales.
The lender said it had beefed up internal accounting controls after the transactions. It flagged up the fault to the Securities and Exchange Commission itself and no punitive action has been taken.
“The transactions did not have a material impact on the bank’s earnings or balance sheet,” said company spokesman Jerry Dubrowski.
BoA, which has denied the six transactions were intentional, highlighted the incorrect accounting in its most recent quarterly results but details of the transactions have just been made available.
The bank reported better than expected earnings of $2.8bn (£1.8bn) in the first quarter of 2010.