An Interesting Take on BofA Succession
Bank of America's management ranks have gone through plenty of upheaval in the past 12 months. Is a new round of departures in store once the board settles on a new chief executive to replace Ken Lewis?
Probably not, a source involved with the succession process tells TheStreet.com. A lengthy article in that online publication lays out a number of reasons why the internal contenders for Lewis' job might opt to stay even if they're passed over at this stage.
Reason no. 1: Importing a temporary, "caretaker" CEO from outside BofA is strong possibility. That would give inside candidates an incentive to stay and keep fighting for the top spot once the interim leader is gone.
The Web site also cites independent banking analyst Nancy Bush saying an external candidate is the "overwhelming" choice of institutional investors who hope for a clear break with the bank's recent string of disasters.
The Key Players
The top two inside contenders - Greg Curl and Brian Moynihan -likely won't leave in any event, according to TheStreet.com's unnamed inside source. He reasons that Curl, BofA's chief risk officer, had never expected the CEO role to come open before the escalating crisis forced Lewis to step aside. Nor had the 49-year old Monynihan, who heads consumer and business banking, expected to get a shot at the CEO's role in the short term. According to that line of thinking, neither man would feel diminished if passed over.
The same source says the other four internal rivals won't rush for the exit unless pushed, because as "dark-horse candidates" they had no "reasonable expectation" of being chosen in the first place. (He does acknowledge that a new CEO could induce them to leave, whether directly or indirectly.) The four are: Sallie Krawcheck, head of global wealth and investment management; Thomas Montag, head of global markets; Barbara Desoer, who runs the mortgage and insurance divisions; and Joe Price, the current CFO.
According to The Street.com, the only one of the four who's shown clear signs of coveting the top job is Montag. He rode out the storms while several other senior executives who'd come over from Merrill Lynch left BofA soon after the merger.
Avoiding an exodus of top talent is important for both shareholders and rank-and-file staff, leadership expert and Harvard Business School professor Michael Beer told TheStreet.com. "Bank of America has been largely a success story and there's a deep culture that's been there for a long time, and that's not necessarily bad. If you just replace a whole bunch of people wholesale, that's going to destroy the culture."
Lewis' retirement is effective at year-end. The bank says it expects to pick a successor "a lot sooner."