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A COMMON complaint at the height of the crisis was that too few Wall Street bosses were being forced to fall on their swords. With the fog of war clearing, exhausted leaders are rushing to leave the battlefield. James Gorman will succeed John Mack as head of Morgan Stanley on January 1st, when Wells Fargo’s chairman, Dick Kovacevich, will also retire. This week change also swept the upper ranks of Bank of America (BofA) and JPMorgan Chase.
Ken Lewis, BofA’s chief executive, announced on September 30th that he too would retire at the end of the year, signalling the end of an eight-year reign that had grown increasingly messy. Shareholders stripped Mr Lewis of the chairmanship earlier this year, irate at the handling of the takeover of Merrill Lynch, an investment bank. The deal has proved endlessly controversial and is now the subject of several state and federal probes. A settlement between BofA and the Securities and Exchange Commission over the bank’s alleged failure to disclose bonuses at Merrill was recently rejected by a judge.
Mr Lewis had suggested that he wanted to stay until the bank had repaid $45 billion in public aid and had finished integrating Merrill and Countrywide, a mortgage lender. But legal distractions were beginning to affect his ability to run the group, which faces further losses to come in consumer and commercial lending. The board must now scramble to pick a successor before he leaves. The half-dozen internal candidates include Brian Moynihan, who runs the retail bank, and Sallie Krawcheck, recently hired to lead wealth management.
By comparison, the succession process at JPMorgan Chase, which is emerging from the financial crisis stronger than any other large bank, looks wonderfully neat. On September 29th Jamie Dimon reshuffled his generals, ousting Bill Winters, co-head of the group’s giant investment bank, and replacing him with Jes Staley, formerly head of the asset-management business. The move sets Mr Staley up as the front-runner to take over should Mr Dimon leave or fall under a bus. The other investment-banking co-head, Steve Black, who is nearing retirement age, will leave after a transition period.
Letting Mr Winters go could not have been easy. He used his deep knowledge of complex financial instruments—he was part of a group at the bank that pioneered credit derivatives—to steer the investment bank away from the mortgage-backed dross that destroyed others’ balance-sheets. JPMorgan Chase is the only big American bank not to have recorded a quarterly loss in the past two years.
But the board pressured Mr Dimon to make hard choices. The lack of a clear succession plan was particularly alarming to some because of what might be called “Steve Jobs syndrome”, after Apple’s idolised boss. Mr Dimon is widely viewed as Wall Street’s sole remaining hero: the title of a new biography is “Last Man Standing”. But this means the bank’s fortunes are increasingly tied to his own. The share price would fall by 20% if Mr Dimon left, Mr Winters once said.
Why pick an asset-management man over such a battle-hardened lieutenant? Mr Staley has won plaudits running his $1.3 trillion division. He has impressed Mr Dimon, who abhors yes men, by standing his ground when they disagree. Insiders say he may also be temperamentally more suited to the top job than Mr Winters.
But Mr Staley should not hold his breath. He is only a year younger than his 53-year-old boss, who seems in no hurry to leave. “I now bleed Morgan blood,” Mr Dimon declares in the biography. He has said he is not interested in running another company. He may be tempted by a career in politics but he would have to cut down on the colourful language. He dreams of running a restaurant but that can surely wait. If Mr Dimon stays more than five years, the next leader is more likely to come from a crop of forty-somethings who have penetrated the top ranks, such as Mike Cavanagh, the finance chief, and Mary Callahan Erdoes, the new head of asset-management. Either way, JPMorgan Chase looks to be in good shape. That cannot yet be said of the institution that Mr Lewis is about to leave behind. |
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发表于 2009-10-2 12:32:44
