Between Ken Lewis’ recent purchases and his comments during today’s press conference with Merrill Lynch Chairman & CEO John Thain, it appears to me that he is trying to build a financial institution in the same fashion that Sandy Weill did at Citigroup. During his opening remarks, Mr. Lewis mentioned building the “premier financial institution in the world,” language that reminds me of Mr. Weil. The size of the bank would speak to this tendency. Having added mortgages and private wealth management by way of Countrywide and U.S. Trust, respectively, Bank of America is simply plugging the holes at this point. LaSalle is further evidence, filling one of the largest holes in the bank’s branch network. For Mr. Lewis, his about-face on investment banking makes this purchase that much more curious. The quality of Merrill Lynch’s operations certainly sets this purchase apart because of the value it adds to B of A, apparently relieving the banks concerns regarding investment banking; the many other aspects of Merrill’s operations also make the purchase an attractive addition to B of A’s portfolio.
I was also happy to hear that B of A is committed to retaining the Merrill name and operations. With the number of ongoing integrations, Mr. Lewis doesn’t expect to begin the Merrill systems integration process until 2010 anyway.