Ira Stepanian is having the last laugh.

Bank of Boston's chairman and chief executive officer - who was rejected twice for a job at the blueblood bank after he graduated from Tufts University 31 years ago - has weathered plenty of criticism for his thoughtful, reserved style.

Wall Street thought he took too long to make decisions. But just four years after assuming the reins, he has not only turned the 208-year-old bank around, he is transforming its culture.

The corporate lender now stresses its commitment to small business and retail customers. Late last year, Mr. Stepanian started taking steps to cut expenses at all levels. He began controversially, by firing three executive vice presidents.

The motive? Mr. Stepanian says that in order to compete with mutual funds powerhouses like Boston's Fidelity Investments, management must be closer to the customer.

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