Ken Lewis

Ken Lewis Keeps Job At Bank Of America; Chrysler's Bob Nardelli Loses His To Italians And Unions

Moe Tkacik | April 29, 2009, 7:08PM

It's a bittersweet happy hour for Bank of America CEO Ken Lewis. As of a few minutes ago, he gets to keep one of his two jobs -- the one with all the work. At the bank's annual meeting today shareholders voted by a razor-thin margin to keep Lewis in the CEO post and sack him as chairman. Walter Massey, a director at the bank and the president of Morehouse College, will replace him in the latter position. Lewis kept his job by a 50.3% vote in part on his strength among brokers who vote on behalf of their clients, bucking calls for reform by a formidable minority including one shareholder who referenced Psalm 83 at today's meeting.

But one name on the Endangered Executives list moved closer to gilded retirement today, according Washington Post report that the Treasury Department is hammering out a bankruptcy plan for the automaker that would replace CEO Bob Nardelli with the management of the Italian auto company Fiat and hand over majority ownership to the company's retirement fund, in exchange for the union's agreement to cut in half the $10 billion it is owed by the company. Chrysler sales were down 39% in March from the year earlier, as compared with 35% at GM, whose CEO Rick Wagoner was asked by the Obama Administration down last month. It's about time: while Lewis and Wagoner both had/have broad bases of support, Nardelli, who pulled down a high nine figure pay package while slashing veteran workers as CEO of Home Depot, doesn't appear to have much at all.

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Ken Lewis

The Campaign To Oust Bank Of America CEO Ken Lewis: But How Would Jesus Vote?

Moe Tkacik | April 29, 2009, 1:16PM

We feel a bit better about our own conflicted feelings about Bank of America's embattled CEO (and happy hour enthusiast) Ken Lewis after reading the Charlotte Observer's live Twitter feed of the bank's annual meeting. Dozens of shareholders are currently giving short speeches for and against ousting him today, and it is clear the bank's owners divided as well. The quintessential annual meeting muckraker Evelyn Y. Davis (the quintessential Evelyn Y. Davis profile is here) just spoke -- and she gave Lewis her full support.

As we noted earlier, the movement to oust Lewis has made bedfellows of MoveOn.org and McCain donors, and the camp that wants to let him stay is equally diverse. Davis, Habitat For Humanity, and the widely-worshiped bank analyst Meredith Whitney are all on Lewis' side. So who did John Moore, the sole shareholder thus far to be reported quoting the Bible, support?

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Henry Paulson

What To Make Of Hank Paulson's "Texan" Threats On Ken Lewis's Job?

Moe Tkacik | April 24, 2009, 4:11PM

It's clear New York Attorney General Andrew Cuomo's probe into the taxpayer-supported Bank of America-Merrill Lynch merger has widened considerably since he began digging into Merrill's accelerated payout of $3.6 billion in bonuses before the disclosure of a devastating fourth quarter loss. But where is it all headed?

Yesterday Cuomo wrote a letter to Congress, the SEC and TARP Oversight chair Elizabeth Warren disclosing a few findings "that raise questions about the transparency of the TARP program, as well as about corporate governance and disclosure practices at Bank of America." But as former Treasury Secretary Hank Paulson once said about such disclosures, the carefully-worded, heavily redacted documents "create more questions than they answer." The most headline-grabbing detail was Paulson's threat to fire Bank of America CEO Ken Lewis if he backed out of the bank's agreement to buy Merrill Lynch at the agreed upon $10 a share; the second was the revelation that the Fed and Treasury had left the SEC "in the dark" throughout the entire process.

The immediate question at hand is whether Lewis broke securities laws or violated his fiduciary duty to protect his shareholders when he went along with Paulson. Certainly many Bank of America shareholders believe so; the news was met with a statement from CtW, the shareholder group campaigning to oust Lewis in a proxy battle declaring that Lewis "violated their legal duties to shareholders in order to protect their own employment interests" when he decided not to invoke the deal's Material Adverse Change clause, which allows companies to get out of merger agreements under some circumstances. Bank of America shares have lost about two-thirds their value since the Lewis announced it was buying the investment bank.

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Ken Lewis

Bank of America CEO Ken Lewis: Truly The Worst?

Moe Tkacik | April 8, 2009, 6:45PM

Now that the Obama Administration has started sacking CEOs, MoveOn asking its 3.2 million members to petition Treasury Secretary Tim Geithner to issue Bank of America CEO Ken Lewis's pink slip next, in a move that appears to be related to the union pension fund-led proxy battle to get bank shareholders to vote him out at the annual meeting later this month. Yesterday Stephen Lerner, a division director of the Service Employees International Union, went on Ed Schultz's new MSNBC show to lambaste the $35 million in pay Lewis had taken home over the past two years when the average teller makes $21,000 a year.

But antipathy toward Lewis is bipartisan. Yesterday Jerry Finger, who manages a Houston-based pension fund and contributed more than $35,000 to Republicans last year, added his 1.1 million votes to the cause, along with a flashy red, white and blue website encouraging fellow shareholders to "vote for change."

But is Lewis really the worst? If any unforgivably reckless institution on the "too big to fail" list deserves more pushing around from the feds, it's Citigroup. And today the influential analyst Meredith Whitney, a relentless critic of the banking sector, praised Lewis and said he should keep his job.

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