Friday, April 24, 2009

The Ken isn't a victim

Posted By on Fri, Apr 24, 2009 at 11:00 AM

Bottom line: the right thing to do was to tell Bank of America shareholders what was going on during the economic collapse and the Merrill Lynch merger. Was it appropriate of Henry Paulson, former U.S. Secretary, or anyone else in the federal government to pressure Ken Lewis? No, and they should be investigated and punished.

However, let's not forget that Ken Lewis could have called a press conference at any time and said, "Hey, can you believe what these jerks are trying to do? They're black-mailing me. They're threatening my career. They're telling me what I have to do with YOUR bank."

He didn't do that, though. Instead, he placed his career concerns above his duty as the head of one of the top U.S. banks. Now, days before the (expected) call for The Ken's job from angry shareholders, he's looking for sympathy.

On whether he could have rejected the government's plan:

Q: Well, there were other ways to go, weren't there? You could have said no, couldn't you?

I did not – at that time, or sometime, I became convinced that they (the government) were right … in the sense that it was not in the best interest of Bank of America, and they had strongly advised us of that, and their intensity with which they said it and the things around that convinced me that they were sincere in saying that.

Q: But you could have said no and resigned, correct?

I could have said no and resigned. Yes.

Q: Did you ever consider that from December 12th to December 31st?

No, I didn't. I thought it was in the best interest to go forward as had been instructed.

Read more of this Charlotte Observer post here.

The New York Attorney General's office has made several documents from their investigation public. You can review them here.

Watch Jonathan Finger, of Finger Interests — a group looking to oust The Ken and two other board members — present his argument on TheDeal.com:

Further reading:

Then-U.S. Secretary Henry Paulson was delivering his own message, and not the Federal Reserve's, when he told Bank of America CEO Kenneth Lewis that the bank was in a binding merger contract with Merrill Lynch and Co., a spokesman for Paulson said on Thursday.

"Secretary Paulson's words were his own," the spokesman said. "(Fed) Chairman (Ben) Bernanke did not instruct him to indicate any specific action the Fed might take," a spokesman for Paulson said in a statement.

Read the rest of this Reuters article here.

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