For John Thain, vindication is sweet.
Sources told The Post that the former Merrill Lynch boss spent yesterday quietly celebrating the resignation of Bank of America CEO Ken Lewis and hopes Lewis’ downfall might help Thain repair his damaged reputation on Wall Street.
According to people familiar with the matter, Thain has told people close to him that he feels “vindicated” now that an embattled Lewis has thrown in the towel. The BofA CEO faces scores of investigations and white-hot investor ire over what he might have known about the billions in losses at Merrill ahead of BofA’s quickie marriage to the then-struggling investment bank.
Sources stressed that Thain doesn’t harbor ill will toward Lewis, but instead is hoping a fallen Lewis will help Thain, the former CEO of the New York Stock Exchange, rehabilitate an image that has sustained significant damage in the wake of the controversial merger.
Thain helped orchestrate the tie-up between Merrill and BofA last year. But Lewis bounced him shortly after the merger was completed in January amid finger-pointing over who withheld from BofA investors key information about some $15 billion in losses at Merrill.
Since then, however, it is Lewis who’s suffered the hit to his reputation as allegations mounted that he was at the center of an effort by BofA to hide Merrill’s losses from shareholders. Lewis is already the subject of investigations by Congress, the FBI, the Justice Department and the attorneys general of both New York and North Carolina. He’s also a target of countless shareholder lawsuits.
Top bankers within BofA said that Lewis’ announcement that he was going to step down came as a surprise to them because he had expressed a desire to fight his accusers. One top BofA official described Lewis as “a combative mother****** with a chip on his shoulder [who] not only looked for a fight but also relished it.”
Meanwhile, sources said BofA’s board has told potential candidates that it will look to fill only the CEO position, and not find someone who can serve as both chairman and chief executive. Lewis, after a bruising shareholder vote, relinquished the chairman’s title, and the plan is to keep those roles separate.
As The Post reported yesterday, BofA may also name an interim CEO to step in until a permanent executive can be named. Among those considered for the role are the current head of investment banking, Brian Moynihan, wealth-management boss Sallie Krawcheck and director Charles Gifford.