Subject category:
Economics, Politics and Business Environment
Published by:
IBS Case Development Center
Length: 9 pages
Data source: Published sources
Topics:
Financial crisis; Sub-prime mortgage business; Mortgage backed securities (MBS); Financial markets; Merrill Lynch; Bank of America; Collateral debt obligations (CDOs); Credit default swaps (CDS); Sub-prime mortgage crisis; Investment banking; Asset management; Wealth management; Charles E Merrill; Hedge funds
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Abstract
This case is structured to resolve two interesting dilemmas: (1) should Merrill Lynch have heen saved through a merger with the Bank of America (BoA)?; and (2) what is the economic logic behind BoA's decision to take over Merrill Lynch in the midst of the US financial crisis (2008)? The case presents a brief history of Merrill Lynch and discusses the growth of Merrill Lynch, followed by its involvement in the sub-prime mortgage business. It explores the financial history of the firm in relation to mortgage-backed collateralised debt obligations (CDOs). The case presents the uncertainty created by declining housing markets and the following credit squeeze. The case describes the final attempts by the firm to survive in the tough financial conditions and the consequences that led the BoA to take over Merrill Lynch.
Subject category:
Economics, Politics and Business Environment
Published by:
IBS Case Development Center
Length: 5 pages
Data source: Published sources
Subject category:
Economics, Politics and Business Environment
Published by:
IBS Case Development Center
Length: 20 pages
Data source: Published sources
Topics:
Financial crisis; Sub-prime mortgage business; Mortgage backed securities (MBS); Financial markets; Merrill Lynch; Bank of America; Collateral debt obligations (CDOs); Credit default swaps (CDS); Sub-prime mortgage crisis; Investment banking; Asset management; Wealth management; Charles E Merrill; Hedge funds
About
Abstract
This case is structured to resolve two interesting dilemmas: (1) should Merrill Lynch have heen saved through a merger with the Bank of America (BoA)?; and (2) what is the economic logic behind BoA's decision to take over Merrill Lynch in the midst of the US financial crisis (2008)? The case presents a brief history of Merrill Lynch and discusses the growth of Merrill Lynch, followed by its involvement in the sub-prime mortgage business. It explores the financial history of the firm in relation to mortgage-backed collateralised debt obligations (CDOs). The case presents the uncertainty created by declining housing markets and the following credit squeeze. The case describes the final attempts by the firm to survive in the tough financial conditions and the consequences that led the BoA to take over Merrill Lynch.
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Subject category:
Economics, Politics and Business Environment
Published by:
IBS Case Development Center
Length: 5 pages
Data source: Published sources
Subject category:
Economics, Politics and Business Environment
Published by:
IBS Case Development Center
Length: 20 pages
Data source: Published sources
Topics:
Financial crisis; Sub-prime mortgage business; Mortgage backed securities (MBS); Financial markets; Merrill Lynch; Bank of America; Collateral debt obligations (CDOs); Credit default swaps (CDS); Sub-prime mortgage crisis; Investment banking; Asset management; Wealth management; Charles E Merrill; Hedge funds