Deals involving Merrill Lynch is costing top executives invloved in the deal their jobs. The latest person to lose chairman’s role is Kenneth Lewis, the head honcho of Bank of America. Lewis has been voted out as chairman and will now only don the job of CEO. The board of BofA, which met on Wednesday, decided to strip Lewis of the role of chairman.
But it was not a unilateral decision by the board. The shareholder proposal to split the chairman and CEO positions passed only with a slight margin winning just 50.34% of the vote.
Bank of America said that Lewis would relinquish the chairman slot immediately but continue as president and CEO. The bank , however, was quick to add that the change doesn’t mean a loss of control or support for Lewis. “He is very much in the driver’s seat in terms of running the company day to day,” said spokesman Robert Stickler, according to Wall Street Journal
Bank of America named Walter E. Massey, a longtime director and president emeritus at Atlanta’s Morehouse College, its new chairman.
Another top executive to lose her job was Ho Ching of Temasek Holdings. In February this year, the Singapore state investment company Temasek, after suffering large paper losses from its Merrill Lynch investment, named a new CEO in Charles W. Goodyear, the former CEO of mining giant BHP Billiton, as Ho Ching’s replacement.
Lewis had been facing criticism for his decision to takeover Merrill Lynch despite knowing that the investment bank was in trouble. He also made testimony in an investigation by New York’s attorney general that he was under pressure from former Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke to not disclose Merrill’s troubles publicly. Critics say Lewis could not stand up against the US government on this deal.