Bank of America Corp. shareholders are to meet Feb. 23 to approve the issuance of more common stock as a result of its exit from federal assistance.
B of A already sold $19.29 billion in common equivalent securities this month as part of a plan to repay $45 billion in capital from the Troubled Asset Relief Program. The $2.39 trillion-asset Charlotte company subsequently repaid the government.
Shareholders must authorize B of A to increase common stock by 1.3 billion shares to complete the securities offering. Otherwise, Bank of America must issue warrants good for 60 million shares of common stock, all but forcing investors to back February's proposal.
The move will cause a "substantial dilution" of existing shareholders, the company said in a filing with the Securities and Exchange Commission on Friday.
