Based on Bank of America's stock performance, Brian Moynihan has been ranked as the worst big bank CEO in the United States. That's even after the 40 percent rally in the bank's shares this year.
This week the banks shareholders will congregate in Charlotte, North Carolina for the bank's annual meeting, where shareholders are expected to vote on whether to approve the pay packages of Moynihan and other top executives.
Big payouts to top tier bank leaders are still expected to be approved, partly because Moynihan reportedly took a $3 million pay cut, making his $7 million payout for 2011 one of the smallest among bank CEO's nationally. Bur shareholders are grumbling that based on the banks poor stock performance, even that payout seems too high.
According to CNN Michael Mayo, a bank analyst at Credit Agricole Securities, recently ranked current bank CEO's by the performance of their shares during the time since they took over the banks. Moynihan became the CEO of Bank of America in early 2010. Since that time the bank's shares have fallen 42 percent.
That performance puts Moynihan at the bottom of the nations CEO heap. But it's not just the bank's poor stock market performance that's at issue. Mayo says there are a number of other significant things that Moynihan has done wrong.
One of the biggest was the controversial bank debit card flip-flop, which backfired spectacularly and inspired a national public petition that led Bank of America to decide under pressure that it wasn't going to charge the fee afterall.
Meanwhile Moynihan, like other bank CEO's, was slow to stem problems in the banks mortgage servicing division, which led to the $25 billion industrywide settlement with state Attorney Generals.
But the news isn't all bad for Moynihan, because the truth is the performances of many other CEO's of large banks haven't been much more impressive.
Shares of Morgan Stanley are down 39 percent since James Gorman started as the head of that firm, also in early 2010 and Citigroup's shares are down a whopping 89 percent since Vikram Pandit took over the job as CEO of Citigroup.
"In the past banks were able to grow out of their problems," Mayo said at the Chartered Financial Analyst (CFA) Institute's annual conference in Chicago. But bad loans, new capital requirements and a lack of opportunity means that's not going to be able to happen this time around.
Mayo predicts this will be the worst decade for sales growth at the banks since the 1930's.
"Citigroup and Bank of America should not be their current size. They need to shrink," he concluded.
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Switch to the desktop site to post a comment.merefalow | May 15, 2012, 06:06 PM EDT
yes great,the only reason they are kicking off is because they were not getting the big returns from one fat cat to a bunch of fat cats,tough,like i said,capitalism is great,providing you are a capitalist.if they had been getting the returns they expected,there wouldn't have been a peep.
Bythebay | May 14, 2012, 06:23 PM EDT
Very funny that the usual "Irish American" moniker isn't in the headline or story.
Murph46 | May 13, 2012, 05:14 PM EDT
Any relation to Daniel Patrick Moynihan? That might explain some!
Bythebay | May 13, 2012, 04:44 PM EDT
Another stellar "Irish American"!
Seanmor | May 13, 2012, 03:41 PM EDT
In the 1980s the Bank of Connecticut (names after a state) failed, and the Bank of New England (named aftsr a region) also failed. Now we hope that CEO Moynihan or any other head of Bank of America (named after the nation) won't allow that bank to go out of business.
Murph46 | May 13, 2012, 02:55 PM EDT
He'll get a raise with bailout money!
Searlit | May 13, 2012, 10:23 AM EDT
Having the Occupy Wall Street protestors arrested after one of them peacefully withdrew her money from her Bank Of America bank account turned many people against the bank.