The Ken Lewis era at Bank of America Corp. is in its final stages.
B of A announced late Wednesday that Lewis will retire from the Charlotte company on Dec. 31. The company said the board is evaluating successors for the executive, with expectations of having the new CEO named by time Lewis steps down.
Lewis' departure ends what has been a stormy 12 months for the hand-picked successor to Hugh McColl Jr. During that stretch, Lewis bought Merrill Lynch & Co., tussled with regulators over that deal, and drew ire from shareholders and others over disclosure decisions over bonuses and losses at the investment bank late last year.
Lewis, 62, had said for months that he wanted to stay at B of A until the $2.3 trillion-asset company could repay $45 billion in funds from the Troubled Asset Relief Program and integrate the acquisitions of Countrywide Financial Corp. and Merrill. And in his most recent pubic appearance, Lewis gave no indication that he might step down, instead using a Sept. 14 speech in Japan to sound an positive tone about the company and the global economy.
He took a different stance in the prepared statement announcing his departure.
"Bank of America is well positioned to meet the continuing challenges of the economy and markets," he said. "We are in position to begin to repay the federal government's Tarp investments. For these reasons, I decided now is the time to begin to transition to the next generation of leadership at Bank of America."
In April, shareholders stripped Lewis of his chairman's title and a series of drastic changes to the board ensued. In August, sources close to the company said that five executives were being considered to replace Lewis: Joe Price, Brian Moynihan, Tom Montag, Sallie Krawcheck and Barbara Desoer. Walter Massey, a retired college president who took over as chairman, said in a statement that the board "will be moving in a deliberate and expeditious manner to select a worthy successor."
Lewis took over a coast-to-coast bank from McColl in April 2001 and continued making big acquisitions, including FleetBoston Financial Corp., credit card issuer MBNA Corp., U.S. Trust Co., LaSalle Bank, Countrywide and Merrill. Each deal gave the company increasing exposure to the U.S. consumer, which has suffered from the housing implosion and recession.
Bank of America, in addition to facing numerous legal challenges over Merrill, is fighting against high losses from several loan portfolios. On Wednesday, the office of New York State Attorney General Andrew Cuomo said in a statement that Lewis' decision to step down will not have an impact on its continuing investigation.