During Ken Thompson's tenure as chief executive, Wachovia Corp. morphed into the fourth-largest bank in the country and topped Bank of America to become Florida's biggest bank.
But in forcing Thompson, 58, to step down, the board of the Charlotte, N.C., megabank came to grips with recent history: a series of problems that forced the company to cut its dividend and caused the stock to lose half its value.
Lanty Smith, who replaced Thompson as chairman last month, will serve as interim chief executive during the search for a new CEO.
"A series of previously disclosed disappointments and setbacks cumulatively have negatively impacted the company and its performance," Smith said.
Among those setbacks: paying $25-billion for home lender Golden West Financial Corp. at the height of the housing bubble. So far Wachovia has had to set aside $2.8-billion to cover losses with problem loans.
Separately, the board of Washington Mutual also took action against that company's controversial CEO Monday, stripping Kerry Killinger of his chairman title.
"The boards of directors of these institutions, which are notably antishareholder, are finally recognizing that they cannot ignore the shareholder demands any longer," said Richard X. Bove, Lutz-based financial strategist with Ladenburg Thalmann.
"You're not going to shift the loan portfolio as rapidly as you can shift the management team," Bove said.
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