Thursday, September 20, 2012

Ken Lewis 'never really fit in' with Wall Street, new book says

A new book by former Federal Deposit Insurance Corp. head Sheila Bair paints an unflattering portrait of former Bank of America CEO Ken Lewis, saying he was viewed as a "country bumpkin" and "never really fit in" with the big-bank crowd, according to an excerpt to be published in Fortune magazine.

Bair chaired the FDIC from 2006 to 2011 and helped engineer the Wall Street bailout. Her new book, "Bull by the Horns: Fighting to Save Main Street From Wall Street and Wall Street From Itself" chronicles the financial crisis.

The excerpt published online Thursday details a meeting of big-bank CEOs where then-Treasury Secretary Hank Paulson tries to convince them to accept the Troubled Asset Relief Program.

She briefly gives her impressions of Citigroup's Vikram Pandit and then Wells Fargo chief Dick Kovacevich before turning to Lewis. Here's the section:

"...I let my gaze drift toward Kenneth Lewis, who stood awkwardly at the end of the big conference table, away from the rest of the group. Lewis, the head of the North Carolina-based Bank of America (BAC) -- had never really fit in with this crowd. He was viewed somewhat as a country bumpkin by the CEOs of the big New York banks, and not completely without justification. He was a decent traditional banker, but as a dealmaker his skills were clearly wanting, as demonstrated by his recent, overpriced bids to buyCountrywide Financial, a leading originator of toxic mortgages, and Merrill Lynch, a leading packager of securities based on toxic mortgages originated by Countrywide and its ilk. His bank had been healthy going into the crisis but would now be burdened by those ill-timed, overly generous acquisitions of two of the sickest financial institutions in the country.
Other CEOs were smarter."
Bair labels JPMorgan Chase CEO Jamie Dimon the smartest.


Anonymous said...

So she labeled Jaime Dimon as the smartest but yet he had no idea his company was losing billions of dollars? Yea Sheila. That says a lot about you!

BH said...

Does she dish on the behind the scenes pressure Paulson and his ilk put on Lewis to buy Countrywide and Merrill?

Just wondering

Anonymous said...

And Kenny is still laughing all the way to the bank...

Anonymous said...

Or maybe Lewis actually saw might happen to the economy if he let Countrywide or Merrill file for Bankruptcy. Everyone does remember what happened when Lehman filed right? Lewis just may have been doing what was best for the industry\country as opposed to just his company.... as far as his dealmaking went... Fleet, MBNA, USTrust, LaSalle..those were pretty good deals just to mention a few

Anonymous said...

Fleet - not bad but overpriced
MBNA - very overpriced (had to take a writedown there)
US Trust - bought a name only
LaSalle - disaster, very bad credit issues
Countrywide - worst deal ever
Merrill Lynch - actually working, by the time it closed, price was very low, turned around quickly