INSTANT VIEW: BofA's Lewis to retire as CEO at year-end
NEW YORK (Reuters) - Beleaguered Bank of America Corp Chief Executive Ken Lewis will retire by year's end and his successor is yet to be determined, the bank said on Wednesday.
The board of the largest U.S. bank will continue evaluating potential successors, a company announcement said.
The following is reaction from industry analysts and investors:
STEPHEN MASSOCCA, MANAGING DIRECTOR, WEDBUSH MORGAN, SAN
FRANCISCO:
"There were clearly concerns the legal and regulatory issues were going to be a distraction at a very difficult time, given the fact that some of these charges were going to be personal in nature. At a minimum, it's certainly a distraction.
At the maximum, these legal actions create disclosures that are damaging to the bank's reputation so that leads to another host of problems, so I do think the market will view this positively.
I will say everybody wanted this transaction to happen, and if it had not happened it would have been a catastrophe for our financial system. People second-guessing now...are not helping."
NANCY BUSH, ANALYST, NAB RESEARCH, ANNADALE, NEW JERSEY
"They had put Brian Moynihan in as head of retail clearly to groom him for that spot but this is just too fast."
"This would seem to me that they're either going to have to name Brian without the benefit of the experience in retail or they're going to have to go outside, one or the other. My suspicion is that if this is coming because of regulatory issues, the regulators may be urging them to go outside anyway."
"He had fought to stay. It's just very odd. I'm of two minds about this. Number one, like everyone else, I'm glad to see this drama over. Number two, this company has really been dealt some blows in the past year and I think this is going to be another blow. They saw themselves as besieged and this is not going to help."
WALTER TODD, PORTFOLIO MANAGER, GREENWOOD CAPITAL
ASSOCIATES, GREENWOOD SOUTH CAROLINA:
"It's a good thing for the company to make a clean break and move forward. Ken Lewis has been overly targeted in terms of how things played out. But the fact is, perception is reality in these situations, and the perception is, everything that happened with the Merrill transaction was his fault, and for Bank of America to move beyond that, Lewis would have to go. That may be right, or it may be wrong."
CAMPBELL HARVEY, PROFESSOR OF FINANCE, DUKE UNIVERSITY:
"This is not unexpected. It was only a matter of time in terms of when he would make the announcement. There is too much collateral damage from the Merrill Lynch episode. Half his job was already taken away, and now the other half is gone. It will give them a little bit more freedom to get on to a new path that is characterized by responsibility from all stakeholders."
(Reporting by Caroline Valetkevitch, Elinor Comlay, Paritosh Bansal and Dan Wilchins)
