Bank of America Corp. (NYSE:BAC) has taken plenty of criticism over the past 12 months on many things that range from the bailout-backed takeover of Merrill Lynch & Co. to outrageous bonuses. But in its defense, BofA is now doing something friendly for some of its largest stakeholders -- the taxpayers. BofA announced Wednesday that it would start accepting IOU payments from California customers as that state's government remains locked in a budget fight.
Bank of America recognizes the State of California budget crisis will impact our clients and customers. To support our customers, while giving the state legislature additional time to pass a budget, we will accept California state-registered warrants - or IOUs - from existing customers and clients. Based on state disbursement estimates, we will accept the registered warrants through July 10, the bank said in a statement. The decision by Bank of America may put pressure on other large and regional banks to follow suit. The grinding of the California state government to a halt is sure to have an adverse effect on the bottom lines of large Wall Street banks, who all have a presence in the world's 10th-largest economy, as well as the area's regional banks. But just how large of an effect remains to be seen as state legislators continue to bicker over budget cuts versus tax increases. -
George White
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Taking an IOU is just Bank of America’s way of pretending (for a while) that none of this is happening.