CEO Vows To Fix Bank Of America

Bank of America’s profits are down 32%, prompting CEO Kenneth D. Lewis to make some angry promises.

From the Wall Street Journal:

“Two-thirds was just mistakes we made in judgment,” Mr. Lewis told analysts on a conference call. “Clearly, we bear a lot of the blame, much more so than just market conditions.”

“There will be some places we do things differently,” Mr. Lewis said in an interview. He added that he is considering scrapping entire investment-banking businesses and has all but ruled out a near-term acquisition or joint venture to try to shore up the unit. Mr. Lewis told analysts he has had “all the fun” he can take from investment banking.

Mr. Lewis even raised the possibility of scaling back the business to its revenue and expense levels of roughly two years ago. That suggests job cuts are looming for the 20,000 corporate and investment-bank employees.

We don’t know what he’s so worried about. Surely, those $3 ATM fees will return Bank of America to its former glory in no time.

CEO Vows to Fix Bank of America [WSJ]
(Photo:meghannmarco)

Comments

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  1. NoNamesLeft says:

    Don’t worry BOA, more fees will surely turn the situation around!

  2. nickripley says:

    Remember that story here about BoA being the equivalent of a dead-beat dad? That was a good one.

  3. Techguy1138 says:

    This story frightens me a bit. I’m a BOA customer that has thus far found boa to be the second best bank I have had.

    It seems like they may try to balance their budget on my back.

  4. Gari N. Corp says:

    Bank of America’s abusive relationship with its investment bankers has been very amusing to behold, though I’m sorry it would end so abruptly.

  5. liquisoft says:

    Step 1: Hire employees who give a damn.
    Step 2: Give employees a reason to continue to give a damn.
    Step 3: Stop with the fees.
    Step 4: Stop sucking so bad.
    Step 5: Profit!

  6. azntg says:

    @liquisoft: Nailed it on the cross! Maybe if they try that then many of us might stop thinking of BoA as the bank with the mutilated American flag.

  7. CoolTri says:

    Maybe their plan is to just start breaking into more safety deposits boxes, or maybe they will just increase there overdraft fee followed by a no negotiation policy.

  8. CoolTri says:

    Errr.. my 1st Post is now in the Land of Lost Post… sux

    They will recover there money… no worries. They start breaking into more Safety deposit boxes, or raise there overdraft fee’s followed shortly there after with a no negotiation policy

  9. Landru says:

    What their sucking at is making money. So as usual, they will resort to cutting expenses and increasing fees: lay off customer service folks and raise overdraft fees.

  10. charmaniac says:

    Banks as they exist right now will be obsolete 50 years from now. They will exist as a lending entity, but there will be no reason to keep your money in a bank because technology will allow a person or company to keep their money in accounts which are separated from banking institutions. That is my prediction.

  11. humphrmi says:

    You guys do, I hope, realize that he’s talking about their Investment Banking unit, which has almost nothing to do with their Retail unit. At the end of the day it all gets piled into a bottom line called “Net profit” but their Retail unit is generating tons of revenue and they aren’t about to change the cash cow.

    More likely they are going to sell their Investment Bank so that they can keep all the profit that Retail is making, instead of dumping it into their fixed income division.

  12. ogman says:

    When BoA jacked up my interest rate for being late on ONE payment to a different company, I told them I would never do business with them again. The woman on the phone seemed genuinely surprised. Therein lies one of their problems.

  13. BigNutty says:

    I dropped BofA many years ago when they stopped providing decent customer service. Everybody move their money out of BofA before they wind up like Enron. I don’t care what the FDIC insurance covers, act fast.

    I can only dream of this post spreading across America and everybody making a run on their bank.

    Can you tell what I really feel about BofA?

  14. oneswellfoop says:

    It will take ten years of perfect, and I mean PERFECT, generous, likeable, and helpful customer service to remove the stink of the stories I have heard about BOA. That only the stories told to me by people I know and trust, not to mention accounts like the one of BOA screwing the old woman out of her savings bond and the like. As for the next ten years, assuming they gain perfect customer service tomorrow; any bank I have my money with that BOA buys I will close all my accounts with, ditto for any bank that courts purchase by BOA or does business too closely with BOA. It is rare that I so proactively dislike a company, or anything for that matter, as much as I do BOA.

  15. ferris209 says:

    Couldn’t have nothing to do with the fact they give loans to illegals, nah, nothing at all!!!

  16. brandymb says:

    Hmmm just have them give more services to illegals.

  17. humphrmi says:

    @brandymb: I doubt that BofA Investment Bank has any services that illegal aliens use.

  18. Buckus says:

    Bank of America for the suck! Is he sure it just isn’t the subprime meltdown causing the problems?

  19. Vodkamusings says:

    I’ve worked at BofA for a number of years. They will use this as an excuse to raise rates and cut some jobs. The real problem at BofA is that they have poor Senior Executives who got the jobs based on their MBA alumni rather than skill. Until they realize that issue, they will continue to bleed with temporary fixes.

  20. caj11 says:

    What about that story about Bank of America refusing to cash that woman’s legitimate savings bond, because they said they had “no record of it”? Was that included in the grandiose plans to fix BoA?

  21. IRSistherootofallevil says:

    I wonder if BoA’s corporate AmEx rate is going to go up to 32% for “universal default” once the woman reports it to the credit bureaus. Or the SEC.

  22. Jaysyn was banned for: http://consumerist.com/5032912/the-subprime-meltdown-will-be-nothing-compared-to-the-prime-meltdown#c7042646 says:

    Yeah, sorry BoA, too f@#$%g late.

  23. fejjnagaf says:

    Um, didn’t they just shell out billions of dollars to buy Lasalle bank?
    That couldn’t have helped their profits…

  24. hapless says:

    @fejjnagaf:

    How many times does soemone have to point out the difference between retail and investment banking? This article doesn’t even mention their retail business.

  25. Dan25 says:

    I wonder how this is going to impact their Private Bank Clients. As someone that works in banking, i just dont understand how getting rid of all of your invetsment specialists is going to help the bottom line? If anything, they will have a lot of pissed off wealthy people that will take their money to my bank.