BofA's Ken Lewis: TARP Funds "A Mistake"

BofA's Ken Lewis: TARP Funds "A Mistake"

Bank of America's CEO Kenneth Lewis told the Financial Times the $20 billion in funds he requested in January was a "tactical mistake" that made the company seem as weak as Citigroup. He said the bank should have requested just $10 billion.

He also said he would continue to helm the North Carolina-based bank until it paid back the $45 billion in government TARP funds it has accessed, which is likely to take another two to three years. It is the first time he signaled he might leave the company, the newspaper reported.

"In hindsight, it was a tactical mistake because it put us in the same category as Citigroup," said Mr Lewis. "We could still have had 8 per cent tier 1 capital after a $15bn loss but we wanted a cushion."

In related news, Lewis earned $9.96 million in salary, stocks and options in 2008, according to a federal filing. It was a 60% drop in compensation from 2007, when the 61-year-old earned $24.8 million.

The compensation included $1.5 million in salary - unchanged from the prior year - and no bonus.

According to Bloomberg:

"Regardless of our profitability and continued progress and growth, our performance did not meet our expectations, including a loss for the fourth quarter," the company's compensation and benefits committee said.

BofA stock was a big loser on Monday, dropping $0.41, or 10%, to $3.55. Shares hit a 26-year low on February 20 of $2.53.

The bank has declined 66% in market value last year, and another 74% since its acquisition of Merrill Lynch.

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