Ken Lewis Is Gone

Tyler Durden's picture

Not a bad move by the man about to be raided by the Fed, the AG, the SEC, the Tooth Fairy and who knows who else. In other news, the Chairman wins again.

From the WSJ.

Ken Lewis, his company faced with multiple government probes, will retire at the end of the year.

Mr. Lewis, who has been chief executive since 2001, was stripped of
his title as chairman in April after a shareholder resolution passed by
a razor-thin margin. Walter Massey was elected to replace him.

Congress, the Securities and Exchange Commission and New York
Attorney General Andrew Cuomo are investigating the company. Lawmakers
have accused him of misleading investors about year-end bonuses paid to
employees at Merrill Lynch & Co. before Bank of America purchased
the teetering Wall Street company late last year.

It is said, cause he was doing so damn well:

"Bank of America is well positioned to meet the continuing challenges
of the economy and markets," Mr. Lewis said. "The Merrill Lynch and
Countrywide integrations are on track and returning value already. We
are in position to begin to repay the federal government's TARP

We wish Ken Lewis and his trial defense team all the best as they prepare for the biggest criminal and civil onslaught against his persona in history.

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Anonymous's picture

he is a scapegoat.

Anonymous's picture


Millivanilli's picture

How can BofA be considered solvent with the likes of Merrill Lynch and Countrywide sitting firmly in the  rectum of the company?

dcosby7's picture

Define solvent.  The Fed defines solvency as what you don't know about the banks, because if you did.....Oh boy!

dcosby7's picture

Define solvent.  The Fed defines solvency as what you don't know about the banks, because if you did.....Oh boy!

Joe Sixpack's picture

Nowadays solvency is an accounting sleight of hand.

sgt_doom's picture

Remember (it has been awhile now) that BofA created the Red Oak Merger Corporation when they took over Countrywide, and moved all its toxic assets (and bad loans) over there.  Then declared bankruptcy on Red Oak, thus once again PRIVATIZING the gain while SOCIALIZING the debt.

Also, BofA still owns a chunk (around a half) of BlackRock, the major asset management firm (Larry Fink of MBS fame) which has received all those no-bid fed contracts (from pal Geithner, both at NY Fed and then with Treasury) to manage those bailout funds.

Still, they are exposed to all those magical derivatives....

Anonymous's picture

Lessee, according to latest OCC report, that leaves
the management of the following Derivative to
Credit Risks:

GS 921%
JPM 283%
C 209%
WFC 71%

Oh, and the Fed at the top of the list...

monmick's picture

Hope he squeals like a pig and brings as many people down with him. Otherwise, I wish him well...


Anonymous's picture

Dead man walking heart attack risk.

Anonymous's picture

aspirin O.D.?

Anonymous's picture

I'll bet the retirement package is beautiful !! Hunker down and take the arrows. No snitchin'. Then cash the check before it bounces.

Anonymous's picture

spot on!

Cognitive Dissonance's picture

I suspect all his legal fees will be paid by B of A.

Anonymous's picture

Does this mean I get my job back there?

Umm... on the other hand....

shorttrader's picture

I guess BERNANKE did succeed with his precictive threat!!!

MsCreant's picture

"about to be raided by the Fed, the AG, the SEC"

Fed = Yeah right. They want everything out in the open.

SEC = Ineffectual, incompetent, dishonest, joke. Probably in on any double dealings too. No real danger there.

AG = Only hope and not so much if he has to concentrate on running for govenor. Gov run could be payoff to leave this alone.

I am pessimistic about this. Could be everyone wants him low profile so that we will forget about it.

I won't forget.



Miles Kendig's picture

He is getting set up to the fall guy of 2009 & 2010.  It will all be his fault.  Biggest depositor institution in the country and he folds up like the fed was gonna take away his cookies.  Lewis is too weak to run a bank like that.

And, you're right.  I won't forget either.

MsCreant's picture

My hope has always been that he would roll over on Paulson and Bernanke. I agree with the sentiment that, in a relative kind of way, Lewis is a victim. What the fuck do you do if the fed has a gun against your head?

Anonymous's picture

If you had integrity, you resign immediately rather than cave in to Paulson's threats. Lewis destroyed himself and Bank of America with the Merrill deal.

Anonymous's picture

Destroyed me too. I was trying to catch falling knives. My hands are still bandaged.


Miles Kendig's picture

Even if he didn't he still subordinated the concept of corporate governance and shareholder value upon the altar of an enfeebled central bank fighting for its existence and continued relevance.  If Lewis would have invoked MAC the fed would have been held powerless.  Either through impotence or through unbridled federal intervention.  Lewis gave up any standing he had by rolling over when he had the power.  Fool.  If he has any smarts at all he would be using every day to data mine his bank in preparation for what is coming his way.  I bet he won't.  Not only does he lack integrity, he lacks common sense.

Miles Kendig's picture

If I were Lewis in that situation I would tell them; "Go ahead, pull the trigger".  There was no way they could have.  The gun wasn't loaded.  If Lewis invoked the MAC and the BA board & its CEO were fired by the fed & treasury what would have been the reaction?

Ken Lewis is just weak at the point of decision and since he is, he going to be rolled for everything he can be.  Even if he wisens up now it will be painful in the extreme and will devolve into a he said he said BS allowing the fed & treasury to put up smokescreens galore and to push the CRE, credit cared, option ARM & bank run potential all on him so they cn say; "See, we told you what would happen if this was mad public".

What a bunch of crap.  Lewis had more juice that GS since he not only had a license, he had the most retail & commercial deposits in the country.  And he folded.

BTW, Classic!  My response...

Lndmvr's picture

Die in a car on the dealership parking lot?

Gilgamesh's picture

Everyone had to take one for the team back then.  Except GS and MS, only because they legally couldn't yet at the time.  But notice where a ton of their stock was siphoned off to - on the cheap - when "they never really needed it (equity infusion)."


Lewis was no victim; you don't get to be picked as CEO of BAC without acknowledging that you answer to higher powers than the shareholders or board.

Missing_Link's picture

It makes perfect sense, Miles.  What better way for Goldman and the Fed to distract the public than to make Ken Lewis and Merrill/BofA the scapegoats?

Miles Kendig's picture

Check.  They might even be able to roll up the WF Golden West/Wachovia Pay Option ARM mess with it and get GS the BA depositor base for a cheaper price than JPM paid for WaMu then GS can get in on the reworked mortgage goldmine that JPM is working for all it's worth snaking 80%+ of all payment flow from the bond holders.  Who knows, they might even manage to peel off C & BA credit card units and merge them. Classic!

If these folks really knew how to be scandalous we would be in even deeper trouble.

Anonymous's picture

we share your pessimism.
Cuomo is not your knight in shining armor.
remember: he was HUD chairman during Clinton.

the story of the day that Obama (speak no evil) went upstate to meet the Guv (see no evil) and the AG (hear no evil) says all you need to know about Cuomo's real intentions.

it ain't got nothin to do with justice.
he's pulling strings with the zeitgeist.

we hope that Patterson will run on a legalize cannabis platform to okie-doke the wizard and force Cuomo to stick the zeitgeist pole up Lewis' bum.

we think Kenny Boy will squeal like southern boys always do.

otherwise, be prepared for more stale bread & flea circuses.

bonddude's picture

Obviously, Patterson hasn't "heard the word" to move on out from the big cheese yet. I wonder what he wants? It would seem Mr. Cuomo's disappointing power play will eventually be successful at the expense of a complete public vetting of the facts he was pursuing. Dammit,

I thought for a millisecond we were going to hear all about it. NOPE.

Miles Kendig's picture

They are letting him stay until the end of the year?  Anyone wanna make book on that one?

Cheeky Bastard's picture

i actually ( not kidding ) feel bad for him; unlike the NYC fucktards he was old school banker; if anyone should be hanged from the gallows on Times Square; Hank Paulson and  Mao Bernanke should ( + couple of 1000 more, but not Ken Lewis ) ....

Anonymous's picture

So few understand, he was one of only a few gentile bankers.

In testimony he was the only one that told the truth and stated you don't go against the fed (who threatened to ruin him and replace the board). You all just don't get it, but Cheeky does. Important to focus on common denominators.

Let's see who replaces him...

Hrundi V. Bakshi's picture

agreed, i can already hear dick bove raising his target price.

agrotera's picture

i listened to dick bove on cnbc (yes, yuck) this morning, and as the discussion of mer/bac was tossed around and the fact that bac paid too much for the deal, this incredible shill kept on insisting that the bac shareholders were fine because of how up the market is now...i guess if someone is shot in the heart, and they fully recover, the shooter should not be prosecuted because the victim is fully recovered-- is this man paid exclusively for his position as shill for the fed cartel?

Gubbmint Cheese's picture

My money is on Sallie krawchek.. But what do I know.. I'm full o' cheese

JohnKing's picture

Let's see who replaces him...

No doubt a GS club member will take the helm, maybe Thain.

trader1's picture

i don't think gentile has anything to do with it.  it all goes to personal character and integrity - which has little do with what your religious preference is.

Anonymous's picture

Religious preference has nothing to do with it, it's all about collusion and friends of the printing press. You must not know who runs "the show"

I am a Man I am Forty's picture

Made some seriously bad moves (ML and not looking out for his shareholders).  He should have done the right thing and told Paulson to pound sand.  B of A was doing some shady shit too with CLO's, lost my family some money giving us fraudulent information (blame ourselves for not doing better dd BTW).  So he definitely deserves go down.  Didn't think the NY banking elite was going to allow some Mississippi kid to hold that much power for long anyway but he walked into their trap.  But I agree, there are many that should have made the short list of free orange jumpsuits prior to him.

I was screaming at my BofA bankers asking them WTF was he thinking with the ML deal and how much he paid for them and so little time for DD.  

So CB, don't feel bad for him, I followed that bank closer than any other and banked with them for many, many years.  They suck too, just don't have as much insider power.

Anonymous's picture

Dittos your comments Cheeky.

Lewis a good guy in a bad situation.

I am a Man I am Forty's picture

Awww shit, now their pumping estrogen through our computers.

The pity party for Captain Ken needs to end.

I've witnessed the fraud first hand at this bank under his leadership.

Careless Whisper's picture

Cheeky been livin in Paris a little too long.

Anonymous's picture

No, I strenuously disagree. Ken Lewis failed a Politics 101 when he let Paulson bully him around. Me thinks all he had to do was to call a press conference and announce that Paulson "suggested" to him that he and his BOD would be replaced if he didn't play ball. [Surely he should have been smart enough to tape a few of those bullying conversations? or call back and do so?]

Basic Axiom - No one in government likes the light shining in on the process or the truth. Government will move mountains to avoid negative publicity. Such a statement to the press would have turned the tables on Paulson, put him on the defensive and immunized the BofA BOD from retribution - Paulson couldn't act after being accused - shoot even the "4th Estate" could have figured that one out!

Gee, all Lewis needed to do was be honest and open, but instead he decided to play in the sewer and now the rats are going to eat him alive. Hope his arrogance, stupidity and political tone deafness are taught in business schools for decades!

Gilgamesh's picture

The above would make complete sense if they weren't on the same team.  Not a team you can quit playing ball for (resigning as bank CEO isn't quitting the team).

Hephasteus's picture

Well cheeky i'm sorry you feel bad for him. He's a freaking central banker. His motto is Always Be Manipulating. Apperently he's a bit of a sympathetic magician cause it's working on people. He spends how much money on a bathroom while being a part of a bank cartel that starves people in south africa to pay themselves more interest?

The reason these people are able to exist without any sympathy is because they know the things they do are so horrible that someday someway nobody will be able to show them ANY sympathy for fear of being an invite to have them in their damn lives. The whole control the world thing is just a mask for how deeply inadequate they are socially, morally, intellectually, ethically, emotionally. If people would stop sucking them up into the sympathy stream they wouldn't be so good at faking it.

war6lock's picture

We have lost a true American Icon......Right Ben, Tim, and Hank. We know that all of you will be there for Ken.

Anonymous's picture

Since I work for ML/BofA, I guess there is no point in defending myself - before 2007, the only mortgage that was clear to me was my own.

Not one person, not on this website either (since it didn't exist), could even spell sub-prime before the Bear Sterns HF collapse in 2007.

I understand the venom with which people attack BofA, but most of us are just normal, hard working folks who try to make money with our clients, not off of them.

And I visit this site, quite often, looking for good information, but the insults grating.

So goes the anonymous comment culture.