This is old news but I wanted to throw out a couple of thoughts about Ken Lewis and his impending departure. I have no great admiration for the guy nor do I think he particularly deserves a whole lot of sympathy but I do think that some of the vitriol that has been directed his way by the MSM and the blogosphere has been over the top.
Felix Salmon made a good point in a post yesterday when he said that running a mega bank was not something that any individual was capable of doing. He suggested that so long as the government supports the business model with supportive fiscal and monetary policies it was practically impossible not to be profitable. He expresses surprise that Pandit of Citi has outlasted Lewis and then has this to say about Pandit:
Meanwhile, if the board starts looking at external candidates, all such candidates must be thinking in the back of their head that a very similar opening is likely to appear at Citigroup sooner rather than later. Vikram Pandit has done amazingly well just to outlast Ken Lewis — his ability to stay in his job is impressive, even if it’s largely a function of the fact that Citi has no succession plan. But as the last of the great destroyers of value still to be drawing a paycheck, he can’t last much longer.
Note that while Felix thinks that bank CEO’s cannot positively influence the outcome of their institutions, he seems perfectly willing to assert that they can destroy the bank. This makes no sense logically but it does typify the sort of disparagement that has been dealt out to Lewis and others.
We really have no idea and probably won’t for years as to whether Ken Lewis was a bumbling idiot or simply a capable banker who got caught in one of the worst storms ever to hit the industry. History, unfortunately, takes time to be written and put in a proper context. Many who put pen to paper or fingers to keyboard have nevertheless come to the conclusion that Lewis is one of the worst of the worst and have not shied from so stating.
Lewis’s real problem was never about his ability to run a bank but rather about his looks, demeanor, background and geographic location. He isn’t Jamie Dimon smooth and he looks like a man either in a permanent state of confusion or one about to rip out a subordinates throat. He never made any bones about his middle class background nor about his strong desire to succeed and running a bank based in Charlotte automatically knocks you down a lot of pegs in the viewpoint of the New York crowd.
Jamie Dimon bought Bear Stearns and got a sweetheart deal from the government to make it work. Ken Lewis bought Merrill Lynch and went back after the fact to get their backing. Little is said of Dimon’s deal while Lewis is vilified for everything connected with the Merrill acquisition. Once again, we don’t know the outcome or for that matter the truth about the events surrounding either event yet many seem more than willing to draw unsupportable conclusions about both and the men who were involved.
Ken Lewis is likely nothing more than a run of the mill banker who made it to the top through driving ambition and probably a lot of luck. He had the bad luck to be at the top when the world started falling apart and likely will pay dearly for that. He’s going to pay a price for that bit of timing and it seems to me that the media should climb down off his back for now.
There will be plenty of time for some honest retrospective analysis when the facts are fully known.