Monday, August 03, 2009

Bank of America Go To End Game

Bank of America (BAC) paid a $33 million traffic fine today.It settles the non disclosure of Bank of America’s agreement that Merrill Lynch could pay over $5 Billion in bonuses as it was failing. The fine is a drop in the bucket. What is significant is the order in which events seem to be transpiring. First Ken Lewis makes claims that the feds led him down the path as he made some dubious acquisitions. Add in a difficult annual meeting where Lewis gets admonished and is stripped of some of his job titles. But the board says it still has confidence in him. Then a steady parade of directors resigns. Then Sallie Krawchuk comes on stage. Then the SEC issues a fine which is more symbolic than punitive.

Can we just get to the end game. Regulators issue big fines but you cannot see their hand in the backrooms.