BofA hires ex-Citi exec Sallie Krawcheck
Ken Lewis names four new executives to the bank's management team, including former Citigroup CFO Sallie Krawcheck, to address company's 'changes.'
NEW YORK (CNNMoney.com) -- Bank of America announced a management shakeup Monday, promoting three to the bank's senior executive team and hiring former Citigroup executive Sallie Krawcheck to run the bank's global wealth management unit.
"The company and the environment have changed significantly," Bank of America CEO Ken Lewis said in a statement. "Considering these challenges and working closely with our board, I reviewed the management team and have decided to make some changes, bringing new talent into the team and adding new perspectives."
One of the most notable additions is Krawcheck, who left Citigroup (C, Fortune 500) in a messy divorce last fall. She was the former head of global wealth management and chief financial officer at Citi. Krawcheck is believed to have feuded with Citigroup CEO Vikram Pandit over payments to clients for toxic auction-rate securities. Krawcheck has argued Citi had a responsibility to pay investors back.
Prior to Citigroup, she served as chief executive of Sanford Bernstein & Co. and executive vice president of Alliance Capital Management.
"I am delighted to join Bank of America," Krawcheck said in a statement. "The combination of the Merrill Lynch, US Trust and Bank of America wealth management franchises is a powerhouse, and I look forward to working with all of the talented people there to reach the businesses' true potential."
Krawcheck faces a tough road. The Merrill Lynch merger has been anything but smooth, with the government providing a controversial $20 billion in additional bailout assistance to see the deal through. On Monday, the SEC said Bank of America (BAC, Fortune 500) would pay $33 million to settle claims it failed to alert shareholders about bonus payments to Merrill Lynch.
The global markets unit Krawcheck is inheriting earned $441 million in the second quarter, down 24% from a year earlier. Lewis said Krawcheck is the right person to turn the unit around.
"I am excited that Sallie Krawcheck has agreed to join our company," Lewis said. "She is acknowledged to be one of the premier executives in the wealth management industry. Her experience and perspective will lead that business to the next level."
In addition to Krawcheck, Lewis promoted Brian Moynihan to head of Consumer Banking, and Tom Montag to Global Corporate and Investment Banking head. David Darnell, head of Global Commercial Banking, will also join the executive team. Liam McGee, who headed the consumer and small business banking unit, left the company.
Lewis also said the company continues to work through its credit issues, and to maintain and enhance its earnings. He has come under fire from shareholders over the past year for the acquisitions of the deeply troubled Countrywide and Merrill Lynch, but the company posted earnings growth that beat expectations in the second quarter.