Ken Lewis, Chief Executive Officer and President of Bank of America Corporation (BAC), announced that he has notified the Board of Directors of his decision to retire, effective December 31, 2009.
The Board will continue ongoing planning to ensure his successor is selected by that date. Lewis will retire both as CEO and as a director.
On Aug. 3, 2009, Lewis, 62, had initiated changes to his executive management committee that increased the depth, expertise and diversity of experience of Bank of America’s leadership team. Lewis had targeted these changes to position a number of senior executives to compete to succeed him at the appropriate time.
Lewis’ decision to retire adds to the uncertainty for a company that has been under attack by regulators and lawmakers since its controversial purchase of Merrill Lynch a little more than a year ago.
The lack of a clear successor to replace Lewis, who has claimed a lot of the credit for transforming Bank of America into one of the biggest success stories in banking in recent years prior to the Merrill deal, raises concerns about the bank’s future.
There are also the various legal actions being taken against the firm related to the Merrill acquisition, including a securities fraud suit brought by the Securities and Exchange Commission that alleges the company misled investors about bonuses paid to Merrill Lynch employees.
Bank of America is one of the world’s largest financial institutions, serving individual consumers, small- and middle-market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk management products and services. The company serves clients in more than 150 countries. Major competitors are Citigroup Inc. (C), JPMorgan Chase & Co. (JPM) and Wells Fargo & Company (WFC).
We currently have a Neutral recommendation on BAC.
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