A group that owns BofA stock is trying to get other shareholders to vote against re-electing Lewis, who is also chairman of the board, as well as Lead Director O. Temple Sloan and Jackie Ward, the Associated Press reported. The election of board members is scheduled to take place at BofA’s annual shareholders meeting on April 29.
BofA has been under increased scrutiny for acquiring Merrill Lynch because of $3.6 billion in bonuses doled out to Merrill executives right before the deal went through. The bonuses are being investigated by the New York attorney general’s office. Also, the more than $15 billion loss Merrill recorded in the fourth quarter has been under examination (see “Cuomo Says Merrill Accelerated Bonus Payments’ and “Merrill Executives Subpoenaed in Bonus Probe’).
Finger Interests Number One Ltd., which owns about one-fifth of 1% of BofA stock, said in a regulatory filing that the board disregarded protecting the interests of shareholders during its purchase of Merrill Lynch, the AP reported. Finger Interests said shareholders were repeatedly misled by the board and not provided proper disclosures during the Merrill acquisition.
The bonuses led to the resignation of former Merrill CEO John Thain as head of wealth management at the combined bank (see “Thain to Leave Bank of America’).
BofA has received an additional $20 billion from the Troubled Asset Relief Program (TARP), in addition to the $25 billion it already received.
Finger Interests is also asking shareholders to approval proposals that would create an independent chairman of the board and allow for advisory voting by shareholders regarding executive compensation, according to the news report.
Another shareholder, Change to Win Investment Group, wants Lewis fired because of the Merrill deal, the AP reported. CtW Investor Group has said that if the bank does not remove Lewis, it will petition shareholders to vote against his re-election at the annual meeting.
The news comes the same day as reports that BofA will be sued by two large state pension funds over the controversial merger with Merrill (see “CA State Retirement Systems Seek to Lead BofA Class Action“).