Charlotte's Economy Extremely Slow To Recover...Bye, Bye Banking Industry

Banking boomtown loses one of its biggest players. Charlotte, N.C. is the country's second largest banking center, but the recent failure of Wachovia has the entire city bracing for fallout from thousands of executive-level layoffs. NBC's Kerry Sanders reports.

Visit msnbc.com for Breaking News, World News, and News about the Economy

Business Leaders Debate Charlotte's Economy


The bankers and the energy boss sparred today over how long the economic recovery will take and what needs to happen to get there.

The chief executives of Bank of America and Wells Fargo, plus a top Federal Reserve Bank official, argued that the recovery was solidly underway and that, despite lingering challenges, the economy will grow next year. But Duke Energy CEO Jim Rogers was more pessimistic, saying massive government debt and officials' tendency to put their “heads in the sand,” could mean a slow rebound.

“I think the recovery, at best, is probably very anemic,” he said.

The debate was part of the Charlotte Chamber's annual Economic Outlook Conference, held at the convention center uptown. It was likely Bank of America CEO Ken Lewis' last public appearance before his year-end retirement, and the crowd responded with a long standing ovation as he took the stage.

Lewis said Charlotte's Unemployment Rate has probably peaked but that it could remain around 10 percent through next year. He expects the stock market and housing market to improve next year, though, he said.

Jeffrey Lacker, president of the Federal Reserve district that includes the Carolinas, said consumer spending on big-ticket items such as cars and houses was recovering. He cited major challenges in the months ahead – particularly the weak job market – but said next year looks better.

“Putting the whole picture together, I believe … the economy will grow at a reasonably healthy pace next year,” Lacker said.

Wells Fargo CEO John Stumpf acknowledged that “it doesn't feel pretty good on Main Street these days,” adding that jobs were the most important element to the recovery.

But he promised that banks are lending all the money they can, and he said Charlotte would benefit from its geographic location, entrepreneurial spirit and talented workforce.

“Your future, and I would say our future, is very bright,” he said.

The economy is resilient, Rogers said, but “what we have had an incredible ability to do is put our heads in the sand,” he said. “… That will make that historical resilience difficult to achieve.”

The bankers admitted that Rogers' scenario is a possibility.

“We have been optimistic to a fault” in predictions in years past, Lewis said. “Given the track record for us, I can't argue against him.”






BofA's next chief could be based in New York


Bank of America Corp. broadened its search for a chief executive officer to include candidates who want to live in New York, acknowledging the bank's biggest units are no longer based in Charlotte, people familiar with the matter said.

The board - led by Chairman Walter Massey - is also concerned there may not be a deep enough pool of qualified candidates willing to move to Charlotte, 400 miles south of Washington, the people said, speaking anonymously because the search is private.

CEO Ken Lewis, who is stepping down at year's end, has said Charlotte will remain headquarters as long as he's in charge.

"It does reflect well on the board that they're not going to let the headquarters location limit their selection in terms of CEOs," said Thomas Brown, CEO of New York-based hedge fund Second Curve Capital. "There aren't too many people around the world who think that Charlotte is a major financial center."

Five board members with ties to Charlotte have stepped down during the past two years, and none of their replacements lives in the city, the state's largest. New directors live in Alabama, Delaware, New York, Ohio, Texas and Virginia. Lewis, 62, is the only N.C. resident.

Former Bank of America CEO Hugh McColl Jr. told a Charlotte group on Oct. 22 that it's unclear whether the next CEO will be based in the city, according to four people who heard his comments at the meeting sponsored by Queens University of Charlotte.

McColl engineered the 1998 acquisition of San Francisco-based BankAmerica Corp., stipulating Charlotte's role as headquarters. He emphasized that he no longer influences the board's decision-making, according to the people who heard his comments. McColl didn't return telephone calls seeking comment.

Bank of America's investment banking and wealth-management businesses, which are run from New York, made up half of revenue through Sept. 30. That's up from 34 percent in the same period last year, before the acquisition of Merrill Lynch & Co.

"With Merrill Lynch being such a big part of the ball game, the CEO probably ought to be in New York," said Arnold Danielson, chairman of Danielson & Associates, an investment banking firm in Bethesda, Maryland.

The home loans and insurance unit - which account for 14 percent of revenue - is based in the former Calabasas, Calif., headquarters of Countrywide Financial Corp., which the bank acquired in 2008. The credit card services unit makes up 23 percent of revenue and is based in Wilmington.

The consumer-banking business under Brian Moynihan in Boston made up 11 percent of revenue. All told, that means about 98 percent of the bank's revenue comes from units headed by executives based outside Charlotte.

"We aren't going to comment on speculation on the process," bank spokesman Jerry Dubrowski said.

Massey leads a search committee of six directors, three of whom joined the board upon the FleetBoston acquisition.

"Some of the Fleet members have no allegiance to Charlotte," Brown said.

Charlotte was home to two of the four biggest U.S. banks until San Francisco-based Wells Fargo & Co. bought Charlotte-based Wachovia Corp. in an October 2008 sale brokered by government regulators.

Bank of America employs 15,000 people in its hometown, said Bob Morgan, president of the Charlotte Chamber, a group that promotes local business interests. That's about 5 percent of the bank's global workforce of 281,863. Wells Fargo has about 19,000 employees in the city after cutting about 2,000 jobs there during the past year, Morgan said.

New Yorkers contacted about the job include Charles Scharf, retail banking head at New York-based JPMorgan Chase & Co., a person familiar with the matter said. Robert Kelly, CEO of Bank of New York Mellon Corp. and a former Wachovia chief financial officer, "has said he has no interest in the job," spokesman Kevin Heine said Tuesday.






Tough times will require Anthony Foxx to find new solutions


And so a new era begins. After 14 years with Republican Mayor Pat McCrory at the wheel, Charlotte will see a new approach in the person of Democrat Anthony Foxx.

We have said from the beginning that Charlotte was fortunate to have two good choices for mayor this year in Foxx and Republican John Lassiter. That's been proven true, and we believe Foxx will perform admirably.

Foxx, 38, is intelligent and hard-working. He also has shown an ability to address shortcomings. Over the course of the campaign, he went from an unpolished candidate inconsistent about articulating a clear message to one who both delved into issues and communicated his stances on those issues effectively.

Foxx, we expect, will be an inclusive mayor who listens to arguments from all sides, all constituents, all City Council members. Foxx has said he will treat the office as a full-time job. He'll run the City Council meetings and work closely with staff on all the issues facing the city. But he'll also use the office as a bully pulpit, calling attention to issues that need it and working with regional, state and federal governments to fight for Charlotte's interests in a collaborative way.

We're confident he will work hard to connect with residents, including by holding regular town halls he promised during the campaign. We believe he will be open-minded about looking for new ways to approach intransigent problems.

We have many hopes for Foxx's tenure. We hope he governs from the heart, not from the polls. We expect him to stand up to his Democratic colleagues on the City Council when needed. With an 8-3 majority, council Democrats could safely ignore the concerns of Republicans if Foxx lets them. We would like to see him fulfill his promise to scour the city budget for areas where spending could be reduced responsibly, knowing that a tax increase on citizens already hurting in a slow economy is not an attractive option. We hope he makes homelessness and affordable housing a truly high priority for the city.

But most of all, we hope he will strive to approach the city's challenges in a new way. These are difficult times, particularly for Charlotte, and will continue to be well into the new year. Foxx faces an entirely different challenge navigating the city out of this slowdown than McCrory did leading Charlotte through 14 years of prosperity. He'll have to avoid the temptation to bring old solutions to new problems, and instead find ways to truly innovate.

We applaud both candidates for the clean, informative campaigns they ran. Lassiter, 55, has loyally served Charlotte and Mecklenburg County for two decades, and we strongly urge him to remain engaged in public life and in this city's future. This loss must be extremely disappointing, but his talents are considerable and Charlotte needs leaders like him in public office.



View Larger Map


Sources: McClatchy Newspapers, Charlotte Observer, MSNBC, Wikipedia, Google Maps

BOFA Rumored To Hire New Ceo By Sunday...Top Industry Candidates Didn't Want Job

Banking boomtown loses one of its biggest players. Charlotte, N.C. is the country's second largest banking center, but the recent failure of Wachovia has the entire city bracing for fallout from thousands of executive-level layoffs. NBC's Kerry Sanders reports.

Visit msnbc.com for Breaking News, World News, and News about the Economy

The Best Job No One Wants


A new CEO for Bank of America could be chosen as early as Sunday, reports Charlie Gasparino. Inside a selection process beset by rivalries, government pressure—and most of all a lack of interest from top candidates.

The board of directors of Bank of America is trying to pick a successor to Ken Lewis, and it really, really wants to finish the job on Sunday night, a senior BofA official tells me. The board is trying to get the job done, this official also tells me, because it’s sick of all the controversy surrounding the selection. Members have been divided over the internal candidates. Others are angered that no one on the outside wants the job of running a bank that is being investigated by the New York attorney general, among others, partially owned by the federal government and thus open to harassment by Rep. Ed Towns, Rep. Barney Frank, various bureaucrats at the Fed, and the giant SEIU, which wants to organize tellers and has a direct line into the Obama White House.

They’re also kind of annoyed at the press, me in particular, for calling the selection process—one that has lasted weeks longer than it should have and featured a prominent board member going on vacation—dysfunctional.

So they want to move and move fast, at least as fast is defined down there in Charlotte, the headquarters city where these decisions get made. Even so, this executive reminds me that the board is still divided over internal candidates and hasn’t settled on someone from the outside to take the job. He also reminds me that the selection process is still beset by rivalries among various board members and pressure from the feds to find someone with better qualifications than senior executives already at the firm. In other words, he concedes, the process is pretty dysfunctional, so it might take a week or, as far he knows, longer than that to announce the new CEO.

Now you know why no one wants this job.

And it’s a shame, because Bank of America is more important than the joke it has become after Lewis purchased Merrill Lynch at the height of the financial crisis for $50 billion, only to later find $15 billion in losses on Merrill’s balance sheet, forcing him to seek a federal bailout to keep the big bank afloat. It’s one of those “systemically important” places that regulators like to say are way too big to just implode and go away, because if it does, billions of customers’ deposits must be covered by FDIC insurance, not to mention all the trading and brokerage accounts at Merrill Lynch that must be unwound, patched up, and placed in safer hands, if there are any left.

Back in the 1950s, there was a saying, “as GM goes, so goes the nation.” General Motors, thankfully, doesn’t carry as much economic weight these days—it was bailed out by the government along with the banks, and look at the trouble we’re in—but Bank of America does, which is why finding someone to run the place is so important.

And that person will have not just to integrate the troubled Merrill Lynch acquisition, he also might have to guide the bank through another banking crisis. Analysts I speak to aren’t all that placated that the banks are healing even as the economy starts to produce growth. The economic growth we have is still being accompanied by rising unemployment, now at 10.2 percent but edging close to 10.5 percent.

What does that mean for Bank of America? Consider the following: The financial firms may have written down much of the residential mortgage debt—the collateralized bond obligations and mortgage-backed securities—that were at the heart of the financial crisis last year.

But consumer-related loans—credit-card receivables, car loans, etc.—are just starting to default, and commercial real estate isn’t doing so hot, either.

So far those defaults haven’t overwhelmed the money BofA has made by borrowing at low rates (the Fed has taken its base rate down close to zero), buying bonds, and carrying those bonds on its books at a higher interest rate. That might change, analysts tell me, if unemployment rises to around 11 percent. That’s when the profitable bond trades are overwhelmed by the consumer debt losses. BofA’s modest profits could well disappear, forcing the bank to raise more capital and who knows what else.

So here’s to hoping this weekend or next weekend or whenever it sees fit, the BofA board finds the right person for the job. Some analysts I know aren’t so optimistic. When banking analyst Mike Mayo heard that the board might be forced to turn to an inexperienced internal candidate because smart people like Larry Fink of BlackRock and Bob Diamond of Barclays Capital didn’t want the job, Mayo had a solution:

Chuck Prince, the former CEO of Citigroup, the other big bank in worse shape than BofA.

The reason: At least he has experience running a failing bank.






Bank of America’s Next Chief May Be Based in New York


Bank of America Corp. broadened its search for a chief executive officer to include candidates who want to live in New York, acknowledging the bank’s biggest units are no longer based in its home of Charlotte, North Carolina, people familiar with the matter said.

The board, led by Chairman Walter Massey, is also concerned there may not be a deep enough pool of qualified candidates willing to move to Charlotte, 330 miles south of Washington, the people said, speaking anonymously because the search is private. CEO Kenneth Lewis, who is stepping down at year’s end, has said Charlotte will remain headquarters as long as he’s in charge.

“It does reflect well on the board that they’re not going to let the headquarters location limit their selection in terms of CEOs,” said Thomas Brown, CEO of New York-based hedge fund Second Curve Capital. “There aren’t too many people around the world who think that Charlotte is a major financial center.”

Five board members with ties to Charlotte have stepped down during the past two years, and none of their replacements lives in the city, the state’s largest. New directors live in Alabama, Delaware, New York, Ohio, Texas and Virginia. Lewis, 62, is the only North Carolina resident.

Curl, Moynihan

The leading internal CEO candidates are Chief Risk Officer Gregory Curl, 61, who lives in Charlotte, and consumer-banking chief Brian Moynihan, who almost left the bank last year after he declined to take a new post in Wilmington, Delaware, according to a person familiar with the situation. Moynihan, 50, lives in Boston, where he worked for FleetBoston Financial Corp. until Lewis bought the lender in 2004.

“We aren’t going to comment on speculation on the process,” bank spokesman Jerry Dubrowski said.

Former Bank of America CEO Hugh McColl Jr. told a Charlotte group on Oct. 22 that it’s unclear whether the next CEO will be based in the city, according to four people who heard his comments at the meeting, which was sponsored by Queens University of Charlotte. McColl engineered the 1998 acquisition of San Francisco-based BankAmerica Corp., stipulating Charlotte’s role as headquarters. He emphasized that he no longer influences the board’s decision-making, according to the people who heard his comments.

McColl didn’t return telephone calls seeking comment.

The Finger family in Houston, owners of more than 1 million Bank of America shares, said in a regulatory filing today that Moynihan and Curl aren’t suitable candidates and provided a list of 18 alternative choices. Their suggestions include former Bank of America executives Alvaro de Molina, now the CEO of GMAC Inc., and James Hance, chairman of Sprint Nextel Co. The Fingers sponsored a campaign earlier this year to oust Lewis.

Calabasas, Wilmington

Bank of America’s investment banking and wealth-management businesses, which are run from New York, made up half of revenue through Sept. 30, up from 34 percent in the same period last year, before the acquisition of Merrill Lynch & Co.

“With Merrill Lynch being such a big part of the ball game, the CEO probably ought to be in New York,” said Arnold Danielson, chairman of Danielson & Associates, an investment- banking firm in Bethesda, Maryland.

The home loans and insurance unit, which account for 14 percent of revenue, is based in the former Calabasas, California headquarters of Countrywide Financial Corp., which the bank acquired in 2008. The credit-card services unit makes up 23 percent of revenue and is based in Wilmington.

The consumer-banking business under Moynihan in Boston made up 11 percent of revenue. All told, that means about 98 percent of the bank’s revenue comes from units headed by executives based outside Charlotte.

Charlotte Jobs

Massey leads a search committee of six directors, three of whom joined the board upon the FleetBoston acquisition. They include retired FleetBoston CEO Charles “Chad” Gifford, who lives in Boston.

“Some of the Fleet members have no allegiance to Charlotte,” Brown said.

The North Carolina city was home to two of the four biggest U.S. banks until San Francisco-based Wells Fargo & Co. bought Charlotte-based Wachovia Corp. in an October 2008 sale brokered by government regulators.

Bank of America employs 15,000 people in its hometown, said Bob Morgan, president of the Charlotte Chamber, a group that promotes local business interests. That’s about 5 percent of the bank’s global workforce of 281,863. Wells Fargo has about 19,000 employees in the city after cutting about 2,000 jobs there during the past year, Morgan said.

New Yorkers contacted about the job include Charles Scharf, retail banking head at New York-based JPMorgan Chase & Co., a person familiar with the matter said. Robert Kelly, CEO of Bank of New York Mellon Corp. and a former Wachovia chief financial officer, “has said he has no interest in the job,” spokesman Kevin Heine said today.

A JPMorgan spokesman, Thomas Kelly, declined to comment on behalf of Scharf.



View Larger Map


Sources: The Daily Beast, BOFA, MSNBC, McClatchy Newspapers, Charlotte Observer, Wikipedia, Google Maps

Deep South Still Isn't Ready To Lead Nation...No Sidewalks, No Innovation, Its Embarassing!

Banking boomtown loses one of its biggest players. Charlotte, N.C. is the country's second largest banking center, but the recent failure of Wachovia has the entire city bracing for fallout from thousands of executive-level layoffs. NBC's Kerry Sanders reports.

Visit msnbc.com for Breaking News, World News, and News about the Economy

A changing, more urbanized South (In Your Dreams!)


You know the images that say "Southern." Kudzu on a red clay bank. A sharecropper's shack abandoned in a field of cotton (or tobacco). Moonshiners vrooming down country roads.

That iconography that has embedded itself in our Southern souls is rural. Even Southern food is the food of rural poverty - the pig parts, greens, sweet potatoes, and corn in multiple manifestations (including distilled into a jug).

Yet a group of Southern leaders and thinkers who gathered last weekend at Davidson College outside Charlotte heard experts describe a region that has become more urban than rural.

Mindsets, though, change more slowly than demographics.

The group was pulled together by a nonpartisan nonprofit group, the Center for a Better South, based in Charleston, for the purpose of devising an Agenda for a Better South - major areas on which Southern leaders should concentrate their efforts. The agenda, still in drafting stages, is to be released in the coming week.

Of course, we talked about education, poverty, race relations, taxes and crime, among other issues. No self-respecting group of "progressives" would otherwise. The agenda's goals are ambitious and admirable. One example, from the draft: To improve health, "each Southern state should increase life expectancy to levels on par with Canada."

Achieving the goals would make this region safer, smarter and healthier. So this isn't a critique of the goal-setting (a process I had to miss). However, I found some of the other topics more thought-provoking.

The South is urbanizing, its demographics changing.

Ferrel Guillory, director of UNC Chapel Hill's Program on Public Life, discussed how in-migration to the South is enriching education and income levels, and for blacks as well as whites.

People are flowing into major metro areas: "The South has shifted from an agrarian to a metropolitan society."

I think much of the Southern leadership infrastructure still puts rural problems ahead of urban ones. Guillory illustrated this: He's been studying South Carolina's poverty-ridden Interstate 95 corridor. Yet, he pointed out, in South Carolina more distressed people live in the city of Columbia than in the I-95 region.

"We're looking at place-based solutions," Guillory said. Instead, maybe we should just focus on people in need, urban or rural.

Should the South forget "Leading"?

Jay Barth of Hendrix College in Conway, Ark., dared ask this. He thinks Southern progress is hindered by several qualities, such as an inability to embrace diversity, including race, ethnicity and sexual orientation.

Another hindrance, he said, is the South's increasing suburbanization. Much of its 20th-century growth has been suburban, unlike the 19th- and early 20th-century growth in the cities of the North.

Suburbanization allows class and race separation to continue, Barth said, and lets suburban residents disconnect from the larger metro region.

In a similar vein, former U.S. Rep. Glen Browder from Alabama was blunt about how the rest of the world views the South. If you think it's a problem that people see an invisible D(emocrat) or R(epublican) behind your name, he said, realize that Southerners have "an invisible S."

"Our brand is broken," he said. "It's tainted."

"Quit dreaming about leading the nation," he advised. Instead, concentrate on improving your state.

Yet from all this emerged no visions that directly confront an urbanizing region. Had I been in the goal-setting, I'd have pushed for one to reduce vehicle travel, for environmental and wellness reasons, or to openly advocate more money for transit.

Old images die hard. Those sepia-tinted memories of mules and music remain powerful for many Southerners. Somehow, the newer image of a minivan in the Target parking lot hasn't embedded itself in anyone's soul - and isn't likely to.



View Larger Map


Sources: McClatchy Newspapers, Charlotte Observer, MSNBC, Wikipedia, Google Maps

BOFA Headquarters Belongs In NYC...My Native Hometown

Banking boomtown loses one of its biggest players. Charlotte, N.C. is the country's second largest banking center, but the recent failure of Wachovia has the entire city bracing for fallout from thousands of executive-level layoffs. NBC's Kerry Sanders reports.

Visit msnbc.com for Breaking News, World News, and News about the Economy

BofA CEO to step down. Bank of America CEO Ken Lewis has notified his board of directors that he will step down by the end of the year. CNBC's Charlie Gasparino reports.

Visit msnbc.com for Breaking News, World News, and News about the Economy

When BofA's HQ goes, it's nothing personal


Bank of America has got to go.

Not a popular position, I realize. But a foregone conclusion, nonetheless.

Our fragile civic psyche has been harpooned by talk that the bank's new leadership team wouldn't want to live here. They've touched our "Hooterville" button, and it stings. Bank of America's roots are sunk deep into the clay and granite of the Piedmont, the thinking goes, and here it belongs.

Fact is, here it belongs is only because here it is. It started here as a parochial lender and, thanks to the genius of its leaders, it succeeded big in the pioneer era of interstate banking.

It snarfed away like a financial Pac-Man, gobbling up banks all over the country. Into its choppers fell giants from Boston, Dallas, Atlanta, St. Louis, Chicago and San Francisco.

And it stayed based here, mostly because of its homegrown leadership.

Our status as the nation's second-largest banking center gave us something to crow about. Most places don't take much pride in being No. 2 at anything, but when No. 1 is New York City and the category is finance, it brought affirmation that we were something special.

Charlotte's fortunes grew with the bank. It was instrumental in building our Emerald City business district, generous to our charities and arts, a magnet for importing brain power. Its executives were our local celebrities, fiduciary rock stars, uptown royalty.

That was a grand era.

Past-tense.

Now, most of the bank's directors are inconvenienced to have to fly to Charlotte to take a meeting. Now, the bank's new president will likely come from beyond our borders. Now, the bank very possibly could change the address of its headquarters.

It has erected a handsome tower in Midtown Manhattan that is taller than the Chrysler building, if you throw in the antenna spike on top. It has absorbed the giant Merrill Lynch brokerage, which will require some sorting out. It is a huge player in a complicated and troubled industry.

And it belongs smack-dab in the heart of the nation's financial center.

Bank of America succeeded so well because it was nimble. It reacted to trends. It took advantage of opportunities.

It would be a blow to our pride to lose the headquarters. But just a glancing blow.

Bank of America would maintain a huge force here. You may move your headquarters to Manhattan, but you'll keep the factory in a cost-efficient place.

Charlotte is full of financial expertise with lots of top-notch talent. We may lose the brain, but we'll keep the shoulders. And they're wide ones.

When we lost Wachovia, Wells Fargo kept a big part of its assembly line here. Little-known fact: Even after shedding about 500 local jobs post-takeover, Wells Fargo still has more workers here than BofA, about 19,000 to 15,000.

Our fortunes will still depend upon Bank of America, and it's in our best interest that the bank do well. It needs to have leadership that can oversee the Merrill transition close-up, leadership that can draw on the best talent available. It needs to be where the action is. It belongs in New York.

We're a business town, we understand business decisions. It's nothing personal.

Fact is, Bank of America has got to go. Regrettably.





Bank of America’s Next Chief May Be Based in New York


Bank of America Corp. broadened its search for a chief executive officer to include candidates who want to live in New York, acknowledging the bank’s biggest units are no longer based in its home of Charlotte, North Carolina, people familiar with the matter said.

The board, led by Chairman Walter Massey, is also concerned there may not be a deep enough pool of qualified candidates willing to move to Charlotte, 330 miles south of Washington, the people said, speaking anonymously because the search is private. CEO Kenneth Lewis, who is stepping down at year’s end, has said Charlotte will remain headquarters as long as he’s in charge.

“It does reflect well on the board that they’re not going to let the headquarters location limit their selection in terms of CEOs,” said Thomas Brown, CEO of New York-based hedge fund Second Curve Capital. “There aren’t too many people around the world who think that Charlotte is a major financial center.”

Five board members with ties to Charlotte have stepped down during the past two years, and none of their replacements lives in the city, the state’s largest. New directors live in Alabama, Delaware, New York, Ohio, Texas and Virginia. Lewis, 62, is the only North Carolina resident.

Curl, Moynihan

The leading internal CEO candidates are Chief Risk Officer Gregory Curl, 61, who lives in Charlotte, and consumer-banking chief Brian Moynihan, who almost left the bank last year after he declined to take a new post in Wilmington, Delaware, according to a person familiar with the situation. Moynihan, 50, lives in Boston, where he worked for FleetBoston Financial Corp. until Lewis bought the lender in 2004.

“We aren’t going to comment on speculation on the process,” bank spokesman Jerry Dubrowski said.

Former Bank of America CEO Hugh McColl Jr. told a Charlotte group on Oct. 22 that it’s unclear whether the next CEO will be based in the city, according to four people who heard his comments at the meeting, which was sponsored by Queens University of Charlotte. McColl engineered the 1998 acquisition of San Francisco-based BankAmerica Corp., stipulating Charlotte’s role as headquarters. He emphasized that he no longer influences the board’s decision-making, according to the people who heard his comments.

McColl didn’t return telephone calls seeking comment.

The Finger family in Houston, owners of more than 1 million Bank of America shares, said in a regulatory filing today that Moynihan and Curl aren’t suitable candidates and provided a list of 18 alternative choices. Their suggestions include former Bank of America executives Alvaro de Molina, now the CEO of GMAC Inc., and James Hance, chairman of Sprint Nextel Co. The Fingers sponsored a campaign earlier this year to oust Lewis.

Calabasas, Wilmington

Bank of America’s investment banking and wealth-management businesses, which are run from New York, made up half of revenue through Sept. 30, up from 34 percent in the same period last year, before the acquisition of Merrill Lynch & Co.

“With Merrill Lynch being such a big part of the ball game, the CEO probably ought to be in New York,” said Arnold Danielson, chairman of Danielson & Associates, an investment- banking firm in Bethesda, Maryland.

The home loans and insurance unit, which account for 14 percent of revenue, is based in the former Calabasas, California headquarters of Countrywide Financial Corp., which the bank acquired in 2008. The credit-card services unit makes up 23 percent of revenue and is based in Wilmington.

The consumer-banking business under Moynihan in Boston made up 11 percent of revenue. All told, that means about 98 percent of the bank’s revenue comes from units headed by executives based outside Charlotte.

Charlotte Jobs

Massey leads a search committee of six directors, three of whom joined the board upon the FleetBoston acquisition. They include retired FleetBoston CEO Charles “Chad” Gifford, who lives in Boston.

“Some of the Fleet members have no allegiance to Charlotte,” Brown said.

The North Carolina city was home to two of the four biggest U.S. banks until San Francisco-based Wells Fargo & Co. bought Charlotte-based Wachovia Corp. in an October 2008 sale brokered by government regulators.

Bank of America employs 15,000 people in its hometown, said Bob Morgan, president of the Charlotte Chamber, a group that promotes local business interests. That’s about 5 percent of the bank’s global workforce of 281,863. Wells Fargo has about 19,000 employees in the city after cutting about 2,000 jobs there during the past year, Morgan said.

New Yorkers contacted about the job include Charles Scharf, retail banking head at New York-based JPMorgan Chase & Co., a person familiar with the matter said. Robert Kelly, CEO of Bank of New York Mellon Corp. and a former Wachovia chief financial officer, “has said he has no interest in the job,” spokesman Kevin Heine said today.

A JPMorgan spokesman, Thomas Kelly, declined to comment on behalf of Scharf.





Report: Next CEO may run Bank of America from New York


This is the kind of news Charlotte boosters have dreaded.

Bloomberg reported Tuesday morning that the Bank of America board of directors has expanded its search for the bank's next CEO to include people who want to live and run the company from New York, not its current headquarters in Charlotte. The reason for expanding the search is attributed to the lack of qualified candidates who wish to move to Charlotte for the job, the report says.

The Bank of America tower uptown, the Charlotte skyline's signature spire, has always been home to the bank's executive offices. Is that status now at risk?

The report cites unnamed sources close to the situation. It also references private comments former BofA chairman Hugh McColl Jr. made recently, acknowledging he no longer influences the board's decisions.

A long commitment to Charlotte

When current bank CEO Ken Lewis announced in September his retirement effective in December, some observers immediately fretted about the bank's future in Charlotte.

The bank has gone through a metamorphosis since its early days in the Queen City. When McColl took over NCNB here three decades ago, he led the bank on a series of acquisitions and name changes, culminating in its merger with San Francisco-based BankAmerica and a name change to Bank of America. But at each step, McColl insisted the growing bank's headquarters remain in Charlotte.

When Lewis, a top McColl lieutenant, took the helm in 2001, he continued to build the empire, buying competing banks, and several other lines of businesses along the way, including the recent purchase of Merrill Lynch & Co.

Today, BofA is a national leader in retail banking, credit cards, mortgages and wealth management. But its diverse business is also geographically scattered. The bank's mortgage business is based in Calabassas, Calif., the former home of Countrywide Financial. Credit cards are based in Wilmington, Del., the former home of MBNA. And Merrill Lynch, the bank's powerful brokerage and investment banking operation, is based in New York.

Consumer banking has remain based in Charlotte, but Brian Moynihan, the former FleetBoston exec who now runs that business, chose to remain in Boston when he took over that line this summer.

Is anyone loyal to Charlotte?

Lewis always maintained his stance that the bank should remain headquartered in Charlotte. But since his retirement announcement, the bank has waged an uphill battle to find a replacement.

The only candidate based in Charlotte believed to still be in the running is chief risk officer Greg Curl, a top deal-maker who has worked and lived here for years.

But Moynihan, the other top internal candidate, has shown no desire to relocate. One external candidate many hoped would be considered is former BofA CFO and current GMAC CEO Al de Molina. But GMAC is in the middle of its own problems, and the chatter around his name has diminished in recent weeks. One report says his name is no longer in the hat.

But all indications suggest the board (which also lacks Charlotte loyalists after a makeover this summer) is still considering external candidates. And according to Tuesday morning's report, there aren't enough outsiders keen on Charlotte.



View Larger Map

Sources: McClatchy Newspapers, Charlotte Observer, Bloomberg.com, MSNBC, Triange Biz Journals, Wikipedia, AP, Youtube, Google Maps

BOFA's New CEO Ok To Live In NYC...Charlotte's An Economic Ghost Town!

Banking boomtown loses one of its biggest players. Charlotte, N.C. is the country's second largest banking center, but the recent failure of Wachovia has the entire city bracing for fallout from thousands of executive-level layoffs. NBC's Kerry Sanders reports.

Visit msnbc.com for Breaking News, World News, and News about the Economy

BofA CEO to step down. Bank of America CEO Ken Lewis has notified his board of directors that he will step down by the end of the year. CNBC's Charlie Gasparino reports.

Visit msnbc.com for Breaking News, World News, and News about the Economy

BofA's next chief may be based in New York


Bank of America Corp. broadened its search for a chief executive officer to include candidates who want to live in New York, acknowledging the bank's biggest units are no longer based in Charlotte, people familiar with the matter said.

The board - led by Chairman Walter Massey - is also concerned there may not be a deep enough pool of qualified candidates willing to move to Charlotte, 400 miles south of Washington, the people said, speaking anonymously because the search is private.

CEO Ken Lewis, who is stepping down at year's end, has said Charlotte will remain headquarters as long as he's in charge.

"It does reflect well on the board that they're not going to let the headquarters location limit their selection in terms of CEOs," said Thomas Brown, CEO of New York-based hedge fund Second Curve Capital. "There aren't too many people around the world who think that Charlotte is a major financial center."

Five board members with ties to Charlotte have stepped down during the past two years, and none of their replacements lives in the city, the state's largest. New directors live in Alabama, Delaware, New York, Ohio, Texas and Virginia. Lewis, 62, is the only N.C. resident.

Former Bank of America CEO Hugh McColl Jr. told a Charlotte group on Oct. 22 that it's unclear whether the next CEO will be based in the city, according to four people who heard his comments at the meeting sponsored by Queens University of Charlotte.

McColl engineered the 1998 acquisition of San Francisco-based BankAmerica Corp., stipulating Charlotte's role as headquarters. He emphasized that he no longer influences the board's decision-making, according to the people who heard his comments. McColl didn't return telephone calls seeking comment.

Bank of America's investment banking and wealth-management businesses, which are run from New York, made up half of revenue through Sept. 30. That's up from 34 percent in the same period last year, before the acquisition of Merrill Lynch & Co.

"With Merrill Lynch being such a big part of the ball game, the CEO probably ought to be in New York," said Arnold Danielson, chairman of Danielson & Associates, an investment banking firm in Bethesda, Maryland.

The home loans and insurance unit - which account for 14 percent of revenue - is based in the former Calabasas, Calif., headquarters of Countrywide Financial Corp., which the bank acquired in 2008. The credit card services unit makes up 23 percent of revenue and is based in Wilmington.

The consumer-banking business under Brian Moynihan in Boston made up 11 percent of revenue. All told, that means about 98 percent of the bank's revenue comes from units headed by executives based outside Charlotte.

"We aren't going to comment on speculation on the process," bank spokesman Jerry Dubrowski said.

Massey leads a search committee of six directors, three of whom joined the board upon the FleetBoston acquisition.

"Some of the Fleet members have no allegiance to Charlotte," Brown said.

Charlotte was home to two of the four biggest U.S. banks until San Francisco-based Wells Fargo & Co. bought Charlotte-based Wachovia Corp. in an October 2008 sale brokered by government regulators.

Bank of America employs 15,000 people in its hometown, said Bob Morgan, president of the Charlotte Chamber, a group that promotes local business interests. That's about 5 percent of the bank's global workforce of 281,863. Wells Fargo has about 19,000 employees in the city after cutting about 2,000 jobs there during the past year, Morgan said.

New Yorkers contacted about the job include Charles Scharf, retail banking head at New York-based JPMorgan Chase & Co., a person familiar with the matter said. Robert Kelly, CEO of Bank of New York Mellon Corp. and a former Wachovia chief financial officer, "has said he has no interest in the job," spokesman Kevin Heine said Tuesday.





Tough times will require Foxx to find new solutions


And so a new era begins. After 14 years with Republican Mayor Pat McCrory at the wheel, Charlotte will see a new approach in the person of Democrat Anthony Foxx.

We have said from the beginning that Charlotte was fortunate to have two good choices for mayor this year in Foxx and Republican John Lassiter. That's been proven true, and we believe Foxx will perform admirably.

Foxx, 38, is intelligent and hard-working. He also has shown an ability to address shortcomings. Over the course of the campaign, he went from an unpolished candidate inconsistent about articulating a clear message to one who both delved into issues and communicated his stances on those issues effectively.

Foxx, we expect, will be an inclusive mayor who listens to arguments from all sides, all constituents, all City Council members. Foxx has said he will treat the office as a full-time job. He'll run the City Council meetings and work closely with staff on all the issues facing the city. But he'll also use the office as a bully pulpit, calling attention to issues that need it and working with regional, state and federal governments to fight for Charlotte's interests in a collaborative way.

We're confident he will work hard to connect with residents, including by holding regular town halls he promised during the campaign. We believe he will be open-minded about looking for new ways to approach intransigent problems.

We have many hopes for Foxx's tenure. We hope he governs from the heart, not from the polls. We expect him to stand up to his Democratic colleagues on the City Council when needed. With an 8-3 majority, council Democrats could safely ignore the concerns of Republicans if Foxx lets them. We would like to see him fulfill his promise to scour the city budget for areas where spending could be reduced responsibly, knowing that a tax increase on citizens already hurting in a slow economy is not an attractive option. We hope he makes homelessness and affordable housing a truly high priority for the city.

But most of all, we hope he will strive to approach the city's challenges in a new way. These are difficult times, particularly for Charlotte, and will continue to be well into the new year. Foxx faces an entirely different challenge navigating the city out of this slowdown than McCrory did leading Charlotte through 14 years of prosperity. He'll have to avoid the temptation to bring old solutions to new problems, and instead find ways to truly innovate.

We applaud both candidates for the clean, informative campaigns they ran. Lassiter, 55, has loyally served Charlotte and Mecklenburg County for two decades, and we strongly urge him to remain engaged in public life and in this city's future. This loss must be extremely disappointing, but his talents are considerable and Charlotte needs leaders like him in public office.



View Larger Map

Sources: McClatchy Newspapers, Charlotte Observer, NY Times, MSNBC, Google Maps