Walter Massey, Chairman of Bank of America Corp. (BofA), has formed a search committee to identify a successor for CEO Ken Lewis, according to sources familiar with the matter.
The committee is considering two executive search firms, Spencer Stuart and Heidrick & Struggles, to help identify potential candidates. Spencer Stuart has been working with BofA on board selection matters since early 2009, while Heidrick & Struggles has supported the bank with senior management recruitment for the past decade.
Recent Board Changes
In 2009, BofA made significant changes to its board, adding nine new members. This included replacing former directors like lead chair Temple Sloan and (Ret.) Gen. Tommy Franks, and bringing in new members such as Dupont Chairman Charles Holliday, who was appointed last month. The bank also added four more directors in June, following the addition of three new Merrill directors in January.
In addition to these board changes, BofA recently hired Sallie Krawcheck, a former Citi executive, to lead its global wealth management and advisory business. However, it remains unclear whether Krawcheck will be considered a candidate for the CEO position.
Challenges and Governance Uncertainty
BofA currently lacks an official CEO succession plan, and the ongoing investigation into the Merrill Lynch acquisition by New York Attorney General Andrew Cuomo has added uncertainty at the highest levels of governance. Both Ken Lewis and Walter Massey have been subpoenaed, and they are named in a lawsuit in Ohio over alleged misrepresentation of shareholder interests. This turmoil suggests that BofA may look outside the bank for its new CEO.
Potential CEO Candidates
As the search for a new CEO continues, two key candidates have emerged:
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Bill Winters – The former co-head of JP Morgan Chase’s investment bank, Winters recently left Chase following an executive shake-up. Winters played a significant role in the bank’s success during challenging times and had a front-row seat to how his former boss, Jamie Dimon, led through periods of upheaval. Some have even speculated that Dimon could step in to lead BofA, although he has expressed regret over not serving his country.
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An “insider/outsider” candidate from the current board – Spencer Stuart has followed a similar approach in the past, most notably when Richard Anderson was named CEO of Delta after joining the board. This model, which is increasingly common in times of corporate uncertainty, depends on transparency and strong relationships within the board.
Next Steps for BofA
The bank’s next CEO will need to secure the approval of BofA’s newly reshaped board, key investors like former Chairman and CEO Hugh McColl, and the federal government. As the search for a suitable candidate continues, it remains uncertain whether the bank will opt for an internal candidate or look outside for new leadership.