CtW demands Banks of America CEO resignation
US - Activist pension fund group Change to Win (CtW) has called for the chairman and chief executive of Bank of America (BoA) to resign - citing a share price collapse and failures of risk management.
CtW alleged BoA took "outsized, reckless risks" in its buyout of Merrill Lynch "in the midst of severe financial uncertainty" and failed to disclose the acquired banks fourth quarter losses prior to the shareholder vote on the merger.
CtW also alleged BoA was aware of Merrill Lynch's intention to pay $3.6bn in bonuses despite its losses, and said the management of BoA either withheld information from shareholders or was "grossly negligent".
The letter said: "Removing [the chairman and chief executive] is now a necessary prerequisite to restoring [BoA's] credibility with shareholders, regulators and the public.
"If the board fails to remove Mr. Lewis prior to filing its 2009 annual meeting proxy this month, we will urge shareholders to join us in opposing Mr. Lewis' re-election and that of the independent directors most culpable for his continued employment."
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