Bank of America Corp. (BAC) Chief Executive Kenneth Lewis once referred to the acquisition of Merrill Lynch as "the strategic opportunity of a lifetime." He might now be reconsidering.

The Charlotte-based bank confirmed Friday it discovered a trading irregularity during a recent probe into Merrill Lynch's trading positions in London. BofA did not quantify how much money might have been lost.

The disclosure is the latest black eye for Lewis since he agreed to buy Merrill Lynch as the credit crisis flared last year. The agreement rescued the troubled brokerage from the kind of collapse that toppled Lehman Brothers (LEHMQ), but has caused Lewis one headache after another since the Sept. 15 agreement was made.

Analysts believe the soap opera that has entangled BofA since the merger shows no signs of ending. In fact, the culture clash within America's biggest bank only seems to be heating up.

"Opportunity of a lifetime? This is turning into the nightmare of a lifetime," said Nancy Bush, a banking analyst and founder of NAB Research. "I don't think Lewis helps himself by not owning up to responsibility for this. The Street is looking for a mea culpa on his part."

The news has been nothing but negative since BofA completed its acquisition of Merrill on Jan. 1. Shares have plunged 75% during that time, and its market value has tumbled to about $20 billion from $90 billion.

Investors were also stunned that Merrill reported a wider-than-expected $15.8 billion loss during the fourth quarter. Despite the loss, former Merrill Lynch CEO John Thain still made eleventh-hour bonus payments of $3.6 billion to employees before the BofA deal closed.

The bonuses not only have caused friction as the two banks have integrated, but caused New York Attorney General Andrew Cuomo to launch an investigation into the matter.

Both Lewis and Thain have been paraded into Cuomo's offices in downtown Manhattan as part of a stream of subpoenas issued to executives. Seven more executives are on tap to give depositions in the coming weeks.

Among the executives being called into Cuomo's office is Dave Gu, the head of Merrill's global rates division. His employee, currency trader Alexis Stenfors, is being investigated for trading irregularities.

Stenfors did not return emails sent to him. A spokesman for Bank of America and Merrill Lynch also would not elaborate on the investigation other than confirming the irregularities.

With an increasing amount of gaffes hovering over the firm, dissatisfaction with BofA leadership has led the investment vehicle for seven labor unions to demand Lewis' replacement. CtW Investment Group, which manages 33 million shares for unions like the International Brotherhood of Teamsters, is expected to address Lewis personally at the bank's annual meeting on April 29 in Charlotte.

"Recent events have fatally undermined investor confidence in Bank of America," CtW Executive Director William Patterson wrote in a letter.

There is no indication that Lewis, 61, would step down from the company where he became CEO in 2001. Analysts believe Lewis still has a chance to prove to investors he's helping the bank right itself, especially when the company reports first-quarter results next month.

Although his job seems safe for now, businesses within the combined company have seen notable personnel departures in the months following the acquisition. While the defection of bankers and other professionals to rivals isn't unheard of on Wall Street, recent exits from Bank of America only highlights potential integration issues.

On Tuesday, for example, Merrill sued Deutsche Bank AG (DB) over the hiring of former Treasurer Eric Heaton and 11 members of its financial institutions group, claiming the rival bank "raided" the business.

Merrill Lynch Global Wealth Management, or the "thundering herd" of more than 16,000 financial advisers, has also taken hits. Recruiters say the unit, the crown jewel of the BofA acquisition, lost more brokers than it brought for a few weeks following the exit of top Merrill executives, including Thain and former brokerage chief Robert McCann.

A spokeswoman for Merrill Lynch's global wealth management business declined to comment.

Bank of America shares closed Friday down 3 cents, or nearly 1%, to $3.14 and are unchanged in recent late trading.

-By Joe Bel Bruno and Brett Philbin, Dow Jones Newswires; 201-938-4047; joe.belbruno@dowjones.com
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