Outgoing Bank of America chief executive Ken Lewis will get no pay this year, the US government's pay tsar has ruled.

Kenneth Feinberg, the US treasury department official who is scrutinising pay packages at bailed-out banks, said that Lewis – besieged by regulatory investigations and lambasted by shareholders – should get no salary or bonus for the year. Lewis agreed.

He will pay back about $1m (£612,000) he has received so far out of a $1.5m annual salary. But the ruling does not apply to his previously negotiated retirement package, estimated to be worth tens of millions of dollars.

"He will write a cheque to the company," a Bank of America spokesman said, adding that Lewis agreed to the proposal because he felt it was not in the bank's best interest "to get into a dispute with the paymaster".

Lewis, 62, announced last month that he would step down as chief executive and retire from the bank by the end of the year, ending a tumultuous 12 months in which Bank of America was accused of misleading shareholders about its acquisition of Merrill Lynch. He has worked at the North Carolina-based firm for 40 years.

Bank of America is due to release its third-quarter results later today.

Wall Street has been eagerly awaiting Feinberg's decisions about pay for 75 of the highest-earning executives at seven firms that got the most taxpayer money. Other companies under scrutiny include Citigroup, Wells Fargo, General Motors, Chrysler and Chrysler Financial.

"The government is proving they are serious about taking money back for poor performance," said Richard Bove of Rochdale Securities.

Bank of America's Merrill acquisition is being investigated by both the Securities and Exchange Commission and the New York attorney general. The AG's office is trying to determine whether the bank misled shareholders about $3.6bn in bonuses paid to Merrill employees and the investment bank's mortgage lending losses.