Need a Bus Ticket?
Chad Gifford, a retired Bank of America Corp. executive, has been grounded.
Gifford will no longer have free use of B of A's private jet, after the board declined to renew a five-year consulting agreement that expired in January. The agreement was created in January 2005 after Gifford retired as the company's chairman. (He had joined B of A a year earlier when it bought FleetBoston Financial Corp., where he had been chief executive.)
The agreement paid Gifford a $50,000 annual retainer, according to a preliminary proxy filed by the company last week. His use of the jet cost the company $1.25 million last year, including tax-related payments to Gifford. The filing said that he will continue to have an office and administrative staff, which last year cost about $238,000.
The filing also revealed that Walter Massey, the company's chairman, and Thomas Ryan, who led the board's compensation committee, would not stand for re-election in April. Massey had reached the company's mandatory retirement age, and no reason was given for Ryan's departure.
B of A declined to comment beyond what the filing said, but a source familiar with Ryan said he wanted to give more attention to his job as CEO of the CVS Corp. drugstore chain.
Bank of America Corp. is shuffling sponsorship activity in Chicago.
The Charlotte company said last week it would become the "global sponsor" of the Chicago Symphony Orchestra through its 2012 season. B of A in the past has sponsored particular concert series and the orchestra's opening night.
B of A, which gained a significant presence in the city through its 2007 purchase of LaSalle Bank, will, however, no longer sponsor the city's annual Bike the Drive event, which closes off a city street to let cyclists have free rein in car lanes. The three-year contract expired last year, and Chicago's MB Financial Inc. took over the sponsorship.
Bank of America spokesman Joe Goode said that the company continues to support education programs of the Active Transportation Alliance, which runs the biking event. "We are excited this family event continues in Chicago," he added.
The banking company also sponsors the Chicago Cubs baseball team and is the Chicago Marathon's title sponsor.
New Best Friend
A regulator could find a lot to love in H. Rodgin Cohen's remarks this week to the Benjamin N. Cardozo School of Law at Yeshiva University in New York.
Speaking at a forum on the challenge of systemic risk regulation, Cohen, the Sullivan & Cromwell LLP lawyer at the center of several recent game-changing deals in banking and finance, said regulation undoubtedly needs to be enhanced, as well as expanded to nonbank firms that compete with the regulated system. That, and he wishes regulators were paid more.
"Most people choose public service, obviously, not for the money," he said. But "increasing the compensation for the regulators" will be crucial if the country expects them to raise their game.
Reform: A Snoozer?
Bipartisan consensus: national dream or nightmare?
Richard Hoey would argue the latter. The chief economist at Bank of New York Mellon Corp. considers bipartisan consensus the root cause of the financial crisis, seeing that politicians working cooperatively in the past pushed homeownership rates to unsustainable, and ultimately destructive, levels.
"Washington decided 64% wasn't good enough," Hoey told members of the Financial Women's Association of New York at a recent forum held in Deutsche Bank's Wall Street headquarters.
Now that the political parties' kumbaya moment has passed, Hoey and his fellow panelists did not expect Congress to do much more tinkering with the system, even to reform it, though Hoey said he still hopes for a quick agreement on resolution authority for big institutions.
Portfolio manager Edward Keon of Prudential Financial said there "needs to be some sort of papering-over to rebuild credibility" for the financial industry, but he doubted that Congress would do much.
And Joe LaVorgna, the chief U.S. economist at Deutsche Bank, said he sees no chance of passing proposals to ban banks from proprietary trading and to tax them based on size. "Our sense is that very little will get done this year," he said.