Assailed by shareholders, regulators, politicians and the law, Ken Lewis last night bowed to the inevitable and said he would retire as chief executive of Bank of America.
The 62-year-old businessman, who turned the sleepy North Carolina bank into one of the largest in the US over almost a decade at the helm, said he would step down at the end of the year. A successor has not yet been decided.
The retirement marks the denouement of a year of pressure since Mr Lewis agreed an audacious takeover of Merrill Lynch, the investment bank, on the fraught weekend that Lehman Brothers collapsed. That deal quickly soured, as Merrill Lynch's losses mounted, and shareholders alleged they were misled about the state of its finances when they voted on the takeover last December.
Mr Lewis has been hauled over the coals by Congressional committees, and was stripped of the title of chairman in a shareholder vote earlier this year. Most seriously, the New York attorney general, Andrew Cuomo, says he is close to laying civil charges against Mr Lewis and other directors for misleading shareholders.
Regulators have also been putting on pressure for a management reshuffle, worrying about the still shaky finances of the bank. The US taxpayer had to invest $45bn in two emergency cash infusions under the bailout scheme, or Troubled Asset Relief Program (Tarp).
Mr Lewis struck a defiant tone over the Merrill deal in his resignation statement last night, saying it was "on track and delivering value". And he added: "Our board of directors and our senior management include more talent, and more diversity of talent, than at any time in this company's history, and we are in position to begin to repay the federal government's [bailout] investments. For these reasons, I decided now is the time to begin to transition to the next generation of leadership."
The BofA chairman, Walter Massey, paid tribute to Mr Lewis's 40 year career at the bank and his ability to integrate a slew of acquisitions that boosted its size under his leadership. "He was a key architect in building a truly global financial franchise," Mr Massey said.Reuse content