Moynihan reshapes Bank of America for an era without big legal costs
By Peter Rudegeair
NEW YORK (Reuters) - While Bank of America Corp (BAC.N: Quote) Chairman and Chief Executive Brian Moynihan has been working to end legal problems, he has also been quietly retooling the bank for a post-crisis world.
He has taken more direct control over the bank's retail business and shifted executives into new positions, sources familiar with the matter said. He has ordered officials at every level of the bank to think harder about how to sell more products to existing customers, a practice that many banks have tried but few have successfully executed.
Moynihan has also helped reshape the board, and his sway with directors only increased when he became chairman earlier this month, the sources said.
The broad changes that he has made signal that he is planning to remain at the bank for the long haul, a minimum of five years, they said.
Some investors have speculated that once Moynihan, a lawyer by training, was done with legal settlements linked to the 2008-2009 housing and financial crisis, he would head for the exits.
Sources at the bank said that notion was false. Key investors fully support Moynihan as well.
"Brian has done a superb job of taking the B of A back to basics and clearing up the problems from the past," Warren Buffett, chairman and CEO of Berkshire Hathaway Inc (BRKa.N: Quote), wrote in an email to Reuters. "He is exactly the right CEO to move the company forward and has the ingredients in place to do so." Berkshire Hathaway owns Bank of America preferred stock and warrants to buy 700 million common shares.
Some media outlets have speculated that when Moynihan does leave, Tom Montag, chief operating officer, will be in pole position to take the CEO spot. The sources at the bank dismissed that speculation, noting that Montag, 57, is older than Moynihan, 55, and that Moynihan is inclined to groom younger successors. Continued...