Indecision of Bank of America (NYSE:BAC) Board Key to Robert Kelly Withdrawing as CEO Candidate

The inability of the Bank of America (NYSE:BAC) to fully support CEO candidate for the firm, Robert Kelly, seems to be the major reason why Kelly withdrew his name from the pool of candidates for the position. Insiders said Kelly didn’t want to have to battle to bring the disparate factions together to support his candidacy for the top job at Bank of America. 

Not surprisingly, but nonetheless nonsensical, the board of directors fought over whether an insider should take the job or an outsider like Kelly should be brought in. Kelly obviously didn’t wait for them to decide or attempt to persuade them.

It’s their loss and Bank of New York Mellon Corp.’s gain, as Kelly will continue to run that bank in his position as Chairman and CEO of the company.

Questions on the motivations of the Bank of America board arise because all candidates for the position from the outside haven’t wanted to take the position. Part of that was because at that time the company still owed TARP funds which brought with it government interference in pay and bonuses, which none of those being sought after for the job were interested in having to deal with. But the other part is it seems very influential board members could be undermining the process for outsiders by making it hard to get past the boards resistance to their being considered seriously for the job; seemingly what happened with Kelly, and possibly with others that have also rejected the position.

There have been conflicting reports on other reasons for Kelly rejecting the position, such as pay, merging the chairman and CEO positions, and how much he likes the potential for growth at BNY Mellon.

But siphoning through the data debris seems to indicate the original and real reason being the board seems to want an internal candidate.

Now that Kelly has rejected the job, it seems like it has brought things to where the majority of the board of directors at Bank of America want it, and that is to hire someone from within the company, which almost assuredly will be 50-year-old consumer banking head Brian Moynihan or Chief Risk Office Gregory Curl, who is 61. Current CEO Kenneth Lewis is scheduled to leave the company at the end of 2009.

Others that have rejected approaches to head up Bank of America have been William Winters who used to be the co-head of the investment banking division of JPMorgan Chase (NYSE:JPM); Citigroup (NYSE:C) director Michael O’Neill; Eugene McQuade, who used to be president of Freddie Mac; and U.S. Bancorp CEO Richard Davis.