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Bank of America’s shareholders get tough—sort ofKEN LEWIS, the boss of Bank of America (BofA), famously said he had had as much fun as he could stand in investment banking in the autumn of 2007. How on earth must he feel now? Mr Lewis’s decision to buy Merrill Lynch in September has cost him his reputation, his independence and, on April 29th, one of his many titles. At the bank’s annual general meeting shareholders re-elected Mr Lewis to the board, but voted to split the role of chairman and chief executive. Walter Massey, a board veteran, replaced him as chairman. Mr Lewis can count himself lucky. True, there was strong logic in buying Merrill Lynch, with its coveted retail brokerage, and Countrywide, a sickly mortgage lender, before that. True too, that the government resisted his belated attempts to get out of the Merrill deal in December, as losses at the bank rapidly worsened. But these are figleaves. The Merrill deal was stitched together too quickly. Mr Lewis agreed on a price (in shares, to give him some credit) that looked inflated even before Merrill posted losses of more than $15 billion in the fourth quarter. “As a group, they are not disciplined buyers,” says Jonathan Finger, a disgruntled shareholder. Claims that Merrill paid out lavish bonuses to employees without BofA’s say-so, and that Mr Lewis was forbidden by officials to disclose details of Merrill’s losses to shareholders (both disputed), make BofA’s managers look impotent at best and contemptuous of shareholders at worst. Hostile investors argue that Merrill was already burning money when they voted on the deal on December 5th, before Mr Lewis crossed swords with the government. ...
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