Bailout Justice: Will Ken Lewis Survive As CEO Of Bank Of America (CNBC Video)
Debating whether Bank of America's Ken Lewis should step down, with Dan Mitchell, CATO Institute; Robert Reich, UC Berkeley; and CNBC's Larry Kudlow (10:38).
Why there's a two-million strong labor union that's been petitioning for Ken Lewis' resignation, with Stephen Lerner, Service Employees International Union director (6:22).
Influential investor advisory group Glass Lewis recommending shareholders to vote against Bank of America's Lewis to the bank's board, with Robert McCormick, Glass Lewis & Co.; Vince Farrell, Soleil Securities; Gordon Charlop, Rosenblatt Securities; and CNBC's Donny Deutsch & Rebecca Jarvis.
Robert Reich tees off on Lewis and oligarchic, chrony capitalism. Bravo.
4 clips are below the fold, 3 where Lewis gets reamed by various partygoers and 1 clip with Maria from Monday where he attempts to ream you..
CTW Reiterates Opposition to Ken Lewis
The following is a statement from the CtW Investment Group regarding Bank of America's reported first quarter earnings released earlier today. Last month, the CtW Investment Group called for shareholders to oppose Bank of America chairman and CEO Kenneth D. Lewis, Lead Director O. Temple Sloan, and Governance Committee chair Thomas Ryan.
"For the past several weeks Bank of America (NYSE: BAC) has sought to turn its first quarter 2009 earnings into a referendum on its acquisition of Merrill Lynch and, by extension, the performance of its board in advance of its April 29th director election. Bank of America released those earnings this morning and, judging by the more than 20% drop in its share price so far today, shareholders are not impressed.
"Bank of America's first quarter earnings of $2.8 billion net of preferred dividends were made possible by aggressive reserve practices and a series of one-time gains. Even so, they do not even begin to offset the $22 billion in pre-tax losses that Merrill incurred in the fourth quarter of 2008, after the merger agreement was signed but before the deal closed.
"Had Bank of America kept its ratio of non-performing loans to the allowance for loan losses constant from December 31, it would have had to boost its loan loss provision by an additional $3.5 billion, more than enough to transform first quarter earnings into a loss after deducting dividends on preferred shares.
Furthermore, the reported $2.8 billion first quarter earnings include one-time gains, including a $1.9 billion pretax gain on the sale of shares in China Construction Bank, $1.5 billion in security gains and $2.2 billion in gains related to mark-to-market adjustments on certain structured notes issued by Merrill.
"The reality is that no earnings report can compensate for the Bank of America board's failures to both disclose Merrill's alarming deterioration prior to the merger vote and prevent nearly $4 billion in pay-for-failure bonuses from going out the door to Merrill executives at the expense of Bank of America shareholders. Today's announcement only reinforces investor concerns that the Merrill acquisition has dramatically increased Bank of America's risk profile even as the quality of its own loan portfolio is deteriorating and the economic outlook remains uncertain.
"The CtW Investment Group therefore reiterates its recommendation that Bank of America shareholders vote against Chairman and CEO Ken Lewis and directors Tom Ryan and Temple Sloan at the bank's April 29 shareholder meeting. Three leading independent proxy voting services - RiskMetrics/ISS, Glass-Lewis and Egan Jones - are also recommending that shareholders vote against directors Lewis and Sloan among others."
Lewis interview with Maria Bartiromo earlier Monday.
Apr 21, 2009 at 3:12 AM
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