Friday, September 21, 2012

Sheila Bair: Former BofA CEO considered a "country bumpkin"

by Bill McBride on 9/21/2012 06:43:00 PM

From former FDIC Chairperson Sheila Bair writing at Fortune: Sheila Bair and the bailout bank titans (ht Soylent Green is People)

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 buy Countrywide 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.
I don't know about Lewis being a "country bumpkin", but the Countrywide acquisition had to be one of the worst ever - and it was obvious to many of us at the time.

Ouch!

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