Abigail with attitude: Bashful Brian grows into top job at BAML

By:
Abigail Hofman
Published on:

Is Bank of America on an upward trajectory? Am I the only person to notice that Bank of America’s economists were a lone voice insisting that the Federal Reserve would not taper in September? Nice call BAML!

Moreover, BAML will be one of the bookrunners for the Twitter flotation. The firm played a bigger role in the Verizon deal, where it acted as an underwriter for the financing package. BAML also had a top-line position in the public-to-private deal for Dell, while in Europe the bank underwrote the £3.2 billion institutional placement of part of the UK government’s stake in Lloyds Bank.
I was thus not surprised to see Brian Moynihan, the chief executive of Bank of America, purring like the proverbial Cheshire cat, as he gave a joint interview to CNBC with the Sage of Omaha, Warren Buffett. All I can say is that bashful Brian has grown into the top job. He now brims with confidence and seems a different man from the diffident, gauche underling who inherited, almost by default, Ken Lewis’ mantle. Moynihan, for so long the underdog in the US bank pecking order, might permit himself a wry smile when he thinks of the bog into which JPMorgan’s chief, Jamie Dimon, has slithered. Increasingly, photographs of Dimon show the banker looking chastened and harassed. His face sags and the bags under his eyes are pronounced, hinting at a lack of sleep. JPMorgan has been fined a total of $920 million by four different regulators for events leading up to the London Whale trading loss. The British Financial Conduct Authority stated that JPMorgan “demonstrated flaws permeating all levels of the firm: from portfolio level right up to senior management”. Dimon, who has apologized repeatedly for these failings, is trying to make amends: more compliance staff, new technology systems and more training on regulation and controls. But underneath the dashboard, has anything changed? In May, at the bank’s annual general meeting, a shareholder vote to install an independent chairman failed. And indeed the longstanding chairman of the board’s risk policy committee, James Crown, refused to resign despite a 42% ‘no’ vote against his re-election. As long ago as July 2009, I called for certain of Morgan’s supine board to step down. But Crown, a director since 2004, sails on invincible. Crown must be close to Dimon, as he goes back with Jamie to the Bank One days. Crown was a director of Bank One Corporation from 1991 to 2004. Remember how, when Jamie fell out with Sandy Weill at Citigroup, disappointed Dimon darted off to Chicago to be chief executive of Bank One? It has been announced that two new individuals will join the JPMorgan board shortly: Michael Neal, former chief executive of GE Capital, and Linda Bammann, former deputy head of risk management at JPMorgan. Some investors are, quite understandably, not satisfied by these changes. After all, Bammann worked for Dimon at JPMorgan and at Bank One. Is she really going to challenge her erstwhile boss? And I’m not sure, after the Whale incident, that having been a risk officer at JPMorgan confers the kudos it once used to. It’s a moot point whether or not pugilistic Dimon can continue to battle it out at the US bank. Frank Sinatra’s words ‘I did it my way’ might have been invented for the JPMorgan boss. However, maybe Dimon now has to adopt the C-word and compromise on a few issues. Cheer up, Jamie, it’s always darkest before dawn. By the way, talking of embattled seniors, did you see that Josef Ackermann, the former chief of Deutsche Bank, is to step down from the board of Siemens? This retreat came only a few weeks after Ackermann abruptly resigned as chairman of Zurich Insurance following the suicide of its chief financial officer, Pierre Wauthier. Apparently, Ackermann’s parting of the ways with Siemens was a result of a disagreement with Siemens’ chairman, Gerhard Cromme, over the ousting of the engineering group’s former chief executive, Peter Loscher, in July. Ackermann may not be having an easy time. But over at Deutsche Bank, co-chief executives Jürgen Fitschen and Anshu Jain are also battling to stand still. Fixed-income revenues for the third quarter are likely to disappoint. And the bank also remains under pressure from regulators to increase capital, decrease leverage and sort out a number of pending legal issues. Who said being a senior banker was a walk in the park?

How was your month? Please send news and views to abigail@euromoney.com