Despite what Ken Lewis may say to staff about how he came down from the mountain recently and decided that he was off as he'd accomplished his goals at Bank of America, we all know that Lewis was forced out by lawmakers, attorneys general and angry shareholders (it was, after all, only a few weeks ago that Lewis told everyone who would listen that he had no intention of going anywhere).

Such has been the clamour for Lewis's head, however, that some even think he should do jail time for misleading his shareholders over the Merrill Lynch acquisition (note that New York State Attorney General Andrew Cuomo is said to be weighing up civil charges against Lewis, but not criminal charges - which would result in jail time). Now we at Here is The City think that jail time for Lewis is a little extreme (and highly unlikely), but equally, we're not sure that it's right that he should sail off into the sun-set (or back up that mountain) with $125m in pension benefits and deferred compensation either. 

Anyway, at the moment, although Lewis will not be entitled to severance, he will walk off with $53m in pension benefits (which will result in a $3.5m per annum pension), and around $72.8m in deferred and other compensation (and that's in addition to the $63m in compensation and benefits he has bagged over the last 3 years). Now critics point out that shareholders haven't done as well under Lewis as the man himself clearly has, as Bank of America's stock is now trading lower than it was in April 2001, when he was appointed CEO. And they have a point when they claim that Lewis has effectively been rewarded for failure.

Now Reuters reports that US pay czar Kenneth Feinberg has a broad authority to issue advisory opinions on the compensation for the top earners of the seven companies (including Bank of America) which needed extraordinary taxpayer assistance, and Lewis may well find that Feinberg (and Congress) has something to say about his healthy financial position. Some stockholders hope so.

There is, however, another view that regards Lewis as a victim in all this - another fall-guy for lawmakers and regulators who failed the system and tolerated financial excesses which caused near economic meltdown. Lewis, they say, was an honorable man who simply tried to do his best from his company and, when called upon to do so, for his country too. So what if he walks off with a $125m pot ? The real culprits, they say, are the likes of former Merrill CEO Stan O'Neal, who left under a cloud in 2007 with a $161.5m exit package - and appears to have got off relatively scot-free.

Reader Comment

'Personally, my sympathies are with Ken Lewis. He was damned if he did go through with the Merrill acquisition, and damned if he didn't. To me, he simply seems to have been guilty of running a bank that was the most obvious acquirer for a Merrill Lynch that was close to failing. In effect, he is the fall-guy'.

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