Merrill Unit Faces Bond Suit in Japan

Takefuji Corp. sued Merrill Lynch Japan Securities Co. for about $309 million over losses on a 2007 bond deal designed to reduce the consumer lender's interest costs.

The lawsuit alleges that Merrill Lynch, now a unit of Bank of America Corp., failed to sufficiently explain the risks in the transaction, under which Takefuji invested in a credit-linked security created by the U.S. brokerage, Takefuji spokesman Kentaro Itai said in an interview.

"We deny the allegation, and we will defend ourselves vigorously," said Takayuki Inoue, a Merrill Lynch spokesman.

For reprint and licensing requests for this article, click here.
Wealth management
MORE FROM AMERICAN BANKER