With New Englander named BofA chief, is Charlotte headquarters still secure?
UPDATE: After a few amusing opening remarks Thursday by outgoing Bank of America CEO Ken "Leno" Lewis, here's newly named CEO Brian Moynihan speaking to BofA employees, advising them to "get lots of rest" over the holidays. They'll need it. Watch the Charlotte Observer video.
Wake up and good morning. New Englander, rugby-playing Ivy Leaguer and Bank of America insider Brian Moynihan (AP photo, left) was just chosen to succeed retiring CEO Ken Lewis and run BofA. But speculation already is swirling.
Could the choice of Moynihan, who is not a southerner like predecessors Lewis and North Carolina banking icon Hugh McColl Jr., mean that BofA's headquarters in Charlotte, N.C., may be in peril? It is a possibility, suggests today's Wall Street Journal. "This is a real break with the past," University of North Carolina finance professor and de facto BofA historian Tony Plath tells the Journal. "It signals to the market that the Fleet-First Boston guys are in charge of the bank now." Here's the story.
The naming of Moynihan surely will disrupt the city of Charlotte so soon after the purchase of its hometown banking giant Wachovia Corp. by California's Wells Fargo. That deal alone cost Charlotte thousands of banking jobs and the loss of headquarters prestige of one of the nation's biggest bank. Even the slight chance that BofA might eventually pick another headquarters city with the new Moynihan regime would prove a major gut punch to Charlotte, which has blossomed quickly as a southern city but only because it has relied heavily, as it calls its two big banks, its "two rich uncles."
Charlotte's hometown newspaper, the Observer, offers a less ambiguous assessment than the Journal of BofA's future -- headquartered in Charlotte. "The bank's headquarters will remain here, Moynihan told the Observer, adding that his office will be in Charlotte. Moynihan's Boston ties had raised concerns, the paper acknowledged, about his commitment to Charlotte. Read the complete story.
Are there implications for Florida? Perhaps. Bank of America is a major player in Florida, so the bank's familiarity and, yes, affection for Florida are big factors in how much attention the economy-beleaguered Sunshine State may receive in the future. Departing CEO Ken Lewis (AP photo, left), a Georgia boy, actually ran the Tampa Bay region of the bank years ago. We're not sure at this point if Moynihan can find Tampa Bay on a map though, of course, hope springs eternal.
The other fascinating piece of the pick of Moynihan is historical and cultural. The original Bank of America was created and built up in California, where Hugh McColl's NationsBank bought it and moved its headquarters to Charlotte. McColl (AP photo, right), long sensitive to the concentration of financial power on Wall Street and the New York City, took great pleasure at the time noting that Charlotte -- with the combined assets of Bank of America and Wachovia (called First Union at the time) -- was the South's first banking powerhouse and could now play in the same circles as those Yankees up north.
As observer Plath (photo, left) notes in the Journal story, it is a condition of his appointment that Moynihan move to Charlotte. That's good news, he says, for the city with 12 percent unemployment centered in the banking sector.
"I don’t know how long that will last," says Plath referring to BofA’s Charlotte headquarters. Here's BofA's press release announcing the pick of Moynihan.
What irony if BofA should end up HQ'd back somewhere up north. Have we just witnessed a shift in the force?
-- Robert Trigaux, Times Business Columnist