Bank of America Corp. knew about Merrill Lynch & Co.’s impending losses and plan to award bonuses when the lender made its takeover bid last year, said John Thain, the brokerage’s former chief executive.

Thain, speaking at Wharton Business School, said he didn’t acclerate bonus payments before the takeover was completed and that Charlotte, NC-based Bank of America shouldn’t have been surprised by the impending fourth-quarter loss. The bank could have been surprised by the size of the deficit, he told an overflow audience.

Bank of America CEO Kenneth Lewis ousted Thain after the deal was completed. The expense of Thain’s office renovation drew criticism, and he said yesterday that in hindsight, the project was a mistake. Thain said he reimbursed the company for the cost.