Bank of America CEO on the hot seat after latest defection
There’s a brain drain at Bank of America — after CEO Brian Moynihan has pulled the plug.
The country’s No. 2 bank is losing its top legal officer — the third high-ranking executive to leave BofA this week — a move that has reignited debate on Wall Street about Moynihan’s role atop the Charlotte, NC-based bank.
The reshuffling puts the fate of the bank squarely on Moynihan’s shoulders, bank watchers said, adding that consolidating power could help him to persuade shareholders not to strip him of either his CEO or chairman titles.
“There’s certainly a perception that this was more of a power grab by the CEO,” Mike Mayo, an analyst at CLSA, told The Post. “There’s certainly a perception that oversight is lacking.”
“With all these changes, there should at least be some additional debate about the structure of Bank of America and the role of the chairman,” he added.
The coming departure of top legal consigliore Gary Lynch, which was first reported Friday by the Wall Street Journal, comes to light just two days after the bank announced that CFO Bruce Thompson — a possible Moynihan successor — and Vice Chairman David Darnell were also leaving.
Lynch, 65, was brought in to handle some of the bank’s biggest settlements from the financial crisis, and will likely stay on in a vice chairman role, a bank insider told The Post.
Thompson’s abrupt exit was reportedly over a disagreement over the future of the bank’s investments.
Larry Grayson, a bank spokesman, declined to comment.
CEO Moynihan added the title of chairman in October 2014 — as the board overrode shareholders, who five years earlier had voted to keep the positions separate.
While dual titles put Moynihan in the company of other Wall Street bigs — like JPMorgan Chase’s Jamie Dimon and Goldman Sachs’ Lloyd Blankfein — some shareholders weren’t pleased.
The board decided earlier this year to give shareholders another shot at a vote to split the titles. That vote will take place by the next annual meeting in May.
Moynihan has two strong allies on the board in Thomas May and Charles Gifford, who both have roots with Moynihan in Fleet Boston, the bank that BofA bought back in 2004, Mayo said.
Moynihan hopes the two successfully lobby to keep the posts combined.