Project New BAC Details

Northern, WI 9/12/2011 (PennyPayDay) – Bank of America Corp. (BAC), the biggest U.S. lender by assets, will likely lose that distinction as Chief Executive Officer Brian T. Moynihan partly dismantles the money-losing empire built by his predecessor.

The firm previously was No. 1 in deposits, mortgage lending and credit cards. Those honors are already gone as Moynihan trims operations added by former CEO Kenneth D. Lewis at a cost of more than $130 billion. When Moynihan is done with his reorganization plan, called Project New BAC, the bank will have pared its workforce by tens of thousands and probably relinquished its lead in assets, jobs and mortgage servicing.

Being the biggest doesn’t matter, Moynihan said in an interview last week. Project New BAC, details of which the CEO may disclose today at a New York investor conference, is designed to make the Charlotte, North Carolina-based bank easier to manage, more focused -- and smaller, said Moynihan, 51. That’s fine with Rebel Cole, a former Federal Reserve economist.

“What kind of stupid business plan is it to be the biggest?” said Cole, now a finance professor at DePaul University in Chicago. “I’d much rather be the most profitable. They wanted to be the biggest and show they could beat Wall Street at its own game -- and they did it until Lewis let his ego destroy the company.”

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