BofA CEO Lewis Lays Out Plans For Bank's Future

Saturday, May 09,2009, 11:11:11 AM Click:

Copyright 2009 Associated Press All Rights Reserved Associated Press Financial Wire

May 8, 2009 Friday 12:59 PM GMT

SECTION: BUSINESS NEWS

LENGTH: 305 words

HEADLINE: BofA CEO Lewis lays out plans for bank's future

BYLINE: By STEPHEN BERNARD, AP Business Writer

DATELINE: NEW YORK

Bank of America's chief executive Ken Lewis laid out his plans for raising new capital to meet regulatory requirements after the government said the bank is facing a $33.9 billion shortfall.

In an wide-ranging interview with CNBC, Lewis also said Friday that the economy is bottoming and that he plans to remain in charge of the bank through the recovery.

The Charlotte, N.C.-based bank will raise capital through asset sales, earnings in the upcoming quarters and raising capital from private investors, Bank of America said during a conference call Thursday night. The bank believes those actions should allow it to avoid needing to convert into common stock some of its $45 billion in government loans under the Troubled Asset Relief Program.

On Thursday, the government announced the results of its bank stress tests, indicating that Bank of America would need an additional $33.9 billion in capital to meet potential losses if the economy worsens. The bank will have six months to raise capital to create that financial cushion.

In the CNBC interview, Lewis said he plans to remain as CEO to help the bank navigate raising the required cash to meet the government's stress-test results and repay the TARP funds. Lewis has come under fire for his acquisition of Merrill Lynch, with some investment groups calling for his ouster.

Lewis said he does not plan to walk away until he can help the bank complete its turnaround and repay the government loan. He told CNBC that he is likely to step down as CEO by the time he turns 65 in three years the traditional retirement age for executives at the bank.

Economic conditions for completing the plan and paying off the loan have improved dramatically in the past two months as the stock market has rebounded from multiyear lows and data has indicated the economic downturn might be slowing.

LOAD-DATE: May 8, 2009