Bank of America broadens its search for a new CEO

Bank of America’s leaders have long been drawn from the crew who transformed a once-modest North Carolina-based lender into a nationwide institution. Even as those empire builders snapped up rivals from San Francisco to Boston, they kept their megabank headquartered in Charlotte, N.C.

Now, Bank of America may be ready to leave behind its southern roots—and even contemplate a move to Broadway.

The bank is broadening its search for a new chief executive to include those who want to live in New York, according to Bloomberg News. Word of Bank of America’s possible New York state of mind follows complaints from a major shareholder that the bank and its board have grown too Charlotte-centric.
Bank of America didn’t return a call seeking comment. But bringing the next head of the nation’s largest bank here would be akin to a headquarters move—arguably the highest profile relocation of a big corporation’s headquarters since Boeing Corp. left Seattle for Chicago in 2001.

The notion that BofA might abandon its home comes amid growing shareholder pressure for the bank to soon identify the successor for CEO Ken Lewis, who is to retire at year’s end. Finger Interests, a family-run investment firm in Houston that owns 1.1 million BofA shares and successfully lobbied for Mr. Lewis to be stripped of his chairmanship earlier this year, wrote a letter to the board demanding they look for candidates outside the company.

The Fingers pointedly urged directors, many of who have joined in the past few months, to “fight the long-time Charlotte influences at the board level that have reduced the independence, objectivity and effectiveness of the board of directors of this company.” Giving Mr. Lewis one last poke in the chest, they thundered: “This is not a monarchy, where the current CEO gets to choose his successor.”

The Fingers’ letter, which was filed with the Securities and Exchange Commission, included a list of 18 CEO candidates, many of which have lived and worked in New York for many years. They include former Citigroup Chief Financial Officer Ned Kelly, J.P. Morgan Chase retail banking chief Charles Scharf, former North Fork Bank CEO John Kanas, former First Union President Tony Terciano, American Express President Alfred Kelly, and even Morgan Stanley CEO John Mack (a native of North Carolina, by the way).

While a transfer of BofA’s headquarters would likely result in only a few hundred new corporate jobs—far too few to make a dent in the tens of thousands of financial jobs lost in New York over the past two years—a move would bring other benefits.

For example, charitable giving from the bank would likely increase locally. Pam McDonough, a former Illinois state official who helped lure Boeing to Chicago, said the aircraft manufacturer quickly became a leading benefactor of Chicago’s public schools shortly after it moved. She added that it helped Chicago’s image to be seen in the place where globally-focused Boeing executives chose to work.

“Every time Boeing was mentioned in the media, Chicago was mentioned, too,” Ms. McDonough said. “That clearly benefits the company and the location.”

The biggest road-block, she said, typically is helping companies recoup their relocation costs. But that shouldn’t be an issue for BofA, which earlier this year opened a fancy new 2.1-million-square-foot building overlooking Bryant Park.

In addition, BofA’s investment banking and Merrill Lynch wealth management divisions are largely based here and together account for half of the firm’s revenue. And of course, former Merrill Lynch CEO John Thain famously left behind an office in the World Financial Center that cost $1.2 million to renovate and should be suitable for even the most discriminating CEO.

Mayor Bloomberg’s office, busy trying to get their boss re-elected on Tuesday, seemed pleased with the idea of a big bank setting its roots here.

“New York City continues to be a place where employers of all sizes want to locate because—while the entire nation faces the challenges of the economic downturn—the city offers the highest quality of life and best prospects for long-term growth,” a spokesman emailed. “We welcome everyone, of course.”

Aaron Elstein is a reporter with Crain’s New York Business, a sister publication to InvestmentNews, where this story first appeared

Related Topics: Bank Of America Corp.