Bank of America to post $600 million pretax writedown in fourth quarter

Bank of America will post a $600 million pretax writedown in the fourth quarter as it redeems $2 billion of trust preferred securities tied to its 2009 acquisition of Merrill Lynch.

“The company expects to realize cash savings from lower funding costs as a result of the redemption,” the Charlotte, North Carolina-based lender said Tuesday in a statement.

The securities, which pay holders 7 percent to 7.28 percent, will no longer count toward the bank’s regulatory capital starting next year, the bank said.

Bank of America is scheduled to report its fourth-quarter results on Jan. 19.