The choice of Charles “Chad” Holliday as the new chairman of Bank of America (NYSE:BAC) may have been at least partially influenced by his experience as CEO of DuPont (NYSE:DD) at a time when the company was expanding it operations internationally.
Bank of America knows growth will come from overseas markets, and the domestic market and mature markets won’t offer much in the regard going forward. So to include Holliday as chairman will at minimum help the board to understand what that means for the company, and could possibly help CEO, Brian Moynihan, when he’s looking for input.
While all emerging markets offer significant growth in all sectors, the particularly lucrative one at this time is the growing demand for wealth management and investment banking. This comes from the growing high net worth individuals that are generating wealth along with their nations.
Of course Canada is highly dependent on China and some of the smaller emerging markets in reference to commodities, which is a big part of their ongoing story, so they were able to be stronger because of that during the recession, but there growth is international more than domestic, confirming again that Bank of America and other major banks will continue to look to global markets for growth, and not North America.
Moynihan has noted that their competitors generate 50 percent or more of their investment banking earnings overseas, while Bank of America only accounts for 25 percent, giving them a lot of room for growth and increasing market share.
In Holliday’s tenure at DuPont, the company either divested of or acquired over $60 billion in businesses, and now over 60 percent of sales for DuPont come from overseas.
Holliday saw going global was the future for DuPont, and that could help during this transition of Bank of America to a more globalized company too.
