Kenneth D. Lewis
chairman, bank of america
Thousands of new customers across the Northeast are flocking to Bank of America Corp., chief executive Kenneth D. Lewis said yesterday, despite a wave of bad publicity over layoffs and other business decisions.
The bank is on track to add 200,000 new checking accounts at FleetBoston Financial Corp. branches by year-end, Lewis said, even though banks traditionally lose customers during mergers. That growth, along with expense savings because of the merger, led Lewis to pronounce the Fleet deal the "smoothest, most positive" transition he has ever seen.
Lewis's comments follow weeks of heated criticism directed at Bank of America over its decision to lay off branch staff and to move the responsibility for two business units away from Boston.
US Representative Barney Frank, a Newton Democrat, attacked the bank in August for what he called its "arrogance, lack of honesty" and "disregard for the economic needs of Massachusetts."
Last week, Bank of America said it would cut an additional 4,500 jobs.
Still, Lewis said yesterday that he separates "politics" from the bank's response from customers, which he said has been positive. Despite the negative publicity, Bank of America continues to gain customers because of its breadth of accounts and other products, its convenience, and the friendliness of its employees, he said.
"We're very pleased with what we've seen," Lewis said after a speech at the Boston College Chief Executives' Club. "We understand there are going to be political issues. People want to hold our feet to the fire to keep the commitment we've made."
He reiterated Bank of America's commitment to New England, which it recently boosted by moving 100 top executives from its wealth-management division here.
Yesterday, several Fleet customers said they were unfazed by Bank of America's layoffs. Mike Bowers, an architect who lives in Melrose, said he likes Fleet's giant branch network, which will only improve with Bank of America. He said he has no plans to move his account.
"It's unfortunate to lose jobs, but it's a standard part of doing business," said Bowers, who has been a Fleet customer for two years. "It's not like they're outsourcing jobs. That's completely different."
Told that Bank of America is, in fact, outsourcing some jobs to India, Bowers said it still would be too inconvenient to change banks, even if staying requires him to "dance with the devil."
Another Fleet customer, Cecilia Roberts, said it is too hard to choose where to shop based on the companies' layoffs or other business practices.
"I feel sorry for those people, but the reality is I have to have a bank that gives me what I need," said Roberts, a Newton librarian. "Right now I'm hoping that's Bank of America."
The customer gains at Fleet also have been fueled by the bank's introduction of free online bill-paying and free checking, executives say.
Bank of America also may know from experience that it can add customers even while cutting jobs. Its last big merger- in which NationsBank of Charlotte, N.C., took over San Francisco's BankAmerica Corp., and the resulting company changed its name to Bank of America- was so divisive that the editorial page of the San Francisco Chronicle labeled the Charlotte executives "sharks" and described the resignation of the old chief executive as "a bank beheading."
Since that time, however, Bank of America has increased its market share in the San Francisco Bay Area to 25 percent from 21 percent, according to data from the Federal Deposit Insurance Corp.
Lewis's speech yesterday pushed the role of banks and city leaders in urban development and also encouraged companies to take the lead in environmentally friendly building. He also went out of his way to bond with the Boston crowd by lavishing praise on the Red Sox. "This is one Boston sports team I can root for," he said.
He neglected, however, to mention one fact: He displays in his office a 1996 Yankees World Series ring, which he got through Bank of America's business relationship with the team.
Article by Sasha Talcott
Thursday, October 14th, 2004