Bank of America’s boss may be finally getting religion on risk-taking – and it looks like a possible bid to keep his job, On The Money has learned.
CEO Brian Moynihan – who has been notoriously cautious leading the nation’s No. 2 bank since the 2008 financial crisis – surprised and delighted insiders and investors alike as he promoted Jim DeMare to group co-president – positioning him as his possible successor.
The reception was joyful partly because inside BofA, DeMare is considered the anti-Moynihan: He’s not from the big bank’s retail banking side, nor is he a lawyer like Moynihan. Instead, he’s a longtime trader who has been running BofA’s capital markets division and its real estate lending business.
His elevation as BofA’s possible CEO-in-waiting also looks like the bank’s current CEO is listening to critics both internally and on Wall Street pushing Moynihan to embrace risk taking to juice earnings and a stock price that has lagged the competition.
As On The Money has reported, Moynihan, who has led the nation’s second-largest bank for the past 15 years, is known for his wokeness (strict adherence to DEI until recently and “debanking” conservatives over the years including President Trump). He’s also known for a plodding and overly cautious management style.
You could argue – as some of Moynihan’s supporters have – that his risk avoidance has kept BofA out of trouble since 2008, which almost spelled its doom. During Moynihan’s tenure as CEO, BofA’s stock is up more than 400% with no major scandal or existential trading loss.
True, but consider: JPMorgan, run by Jamie Dimon, is up nearly 700% during that time. JPM uses its balance sheet all the time to win deals, and its balance sheet is among the banking sector’s strongest.
Also getting a bump to co-president is Dean Athanasia, head of regional banking, setting up a horse race between two of the big bank’s top executives.
Until the unrest began bubbling up this year over Moynihan’s weak-kneed management, Athanasia was seen as the odds-on favorite to be the next CEO. As one BofA insider put it: “He’s the carbon copy of Brian; a retail banker who looks at capital markets as an afterthought. They are literally the same person in different bodies.”
DeMare, meanwhile, is seen as a charismatic leader, well-liked by his troops. Moynihan’s supporters say the reason DeMare has been able to outperform — 13 straight quarters of his division cranking out profits — is because the CEO gave him the portfolio to do so.
Maybe, but his emergence is seen as proof that risk is in the air at BofA. He’s odds-on favorite for the top job since he provides expertise in capital markets that the bank needs to better compete with JPM.
That’s if he sticks around. As reported, Moynihan, 65, says he wants to stay as CEO until he’s 70. Both Athanasia, 59, and the 56-year-old DeMare head large swaths of BofA’s balance sheet. But given their age, they may not wait for Moynihan to call it quits if the right CEO opportunity emerges elsewhere.
Other names could make the short list include Holly O’Neill, president, consumer, retail; Lindsay Hans the head of wealth management; and Wendy Stewart, president of global commercial banking.
That’s why there’s talk inside BofA that Moynihan might leave sooner than his stated end-date of 2030.
“Brian staying until 2030 is like those promises to reach net-zero carbon emissions by 2050,” said another BofA insider. “People keep talking about it but no one thinks it’s realistic. “
A BofA rep had no comment.
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