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Subject: Bank of America Probe a Challenge for CEO Author: Gerald Latham [ Next Thread | Previous Thread | Next Message | Previous Message ] Date Posted: 15:15:55 09/06/03 Sat Bank of America Probe a Challenge for CEO Sat September 6, 2003 10:14 AM ET By Jonathan Stempel NEW YORK (Reuters) - In Kenneth Lewis' 29 months at the helm of Bank of America Corp. BAC.N , the No. 3 U.S. bank had been spared the wrath of regulators conducting high-profile probes of its business. No longer. The Charlotte, North Carolina-based bank's Nations Funds are at the center of New York Attorney General Eliot Spitzer's probe into whether some funds kowtow to quick traders who generate big fees, at the expense of mom-and-pop investors. It's an unwelcome challenge for Lewis, 56, who has been trying to build the bank's asset management business and wrest retail and investment banking customers from Citigroup Inc. C.N and J.P. Morgan Chase & Co. JPM.N , among others. "From a headline perspective, the exposure may be large," said Anton Schutz, who began buying the bank's shares in July for his $230 million Burnham Financial Services Fund BURKX.O . Bank of America shares have risen about 40 percent, from $54.90, since Lewis took over from the more charismatic Hugh McColl in April 2001. Through mergers, McColl transformed the former NCNB Corp. into a banking powerhouse. The shares have slipped about 10 percent from their $84.90 peak on July 14. Analysts expect Bank of America to weather the probe, but with some pain, including a likely fine. This February, it started a $100 million ad campaign called "Higher Standards." "It will take some management time, but I don't think it should be a major negative influence on the stock over the long-term," said Richard Howe, who helps invest $3 billion for Freedom Capital LLC in Boston, including in Bank of America. Spitzer is also probing Bank One Corp. ONE.N , Janus Capital Group Inc. JNS.N and Strong Capital Management Inc., but his allegations against Bank of America are the most serious. [ Next Thread | Previous Thread | Next Message | Previous Message ]