(Bloomberg) — Tom Montag has dominated Bank of America Corp.’s massive investment bank for more than a decade, running not only his businesses but also single-handedly serving many of his top clients.
The news that he will be leaving his old Wall Street position at the end of the year has left a question within the company and across the industry: who could fill such shoes?
The news around Bank of America is that Montag’s responsibilities could be split among a few people. The company has vowed to say more about the succession in the coming weeks. Meanwhile, talks are underway and closely guarded. Many insiders, of course, wonder what a contingent of senior executives overseeing some of the mainstays of Wall Street powerhouse Montag, 64, have helped build it: dealmaking, trading and commercial banking.
Matthew Koder leads the global corporate and investment banking division. Jim DeMare is president of global markets. And Alastair Borthwick is in charge of the extensive commercial banking business, serving medium-sized businesses and sectors such as real estate and education. All three are members of the executive management committee, the company’s highest decision-making body.
Like Montag, Koder started out at Goldman Sachs Group Inc. After several years at UBS Group AG in London and Hong Kong, the Australian joined Bank of America in 2011 as head of dealmaking in Asia. the region.
The bank tapped Koder, 49, for his current position in 2018, when an internal debate over risk-taking led to the departure of Christian Meissner, an episode that irked some dealmakers. At the time, Koder had a reputation for adhering to the Bank of America’s low tolerance for danger.
DeMare, an alumnus of the trading floors of Salomon Brothers and Citigroup Inc., joined Bank of America in 2008. Over the years, he held positions responsible for trading, origination and risk management activities within Bank of America’s fixed income business.
Long seen as a candidate for senior positions, DeMare was given his current title and was added to the company’s management committee in mid-2020 as he guided its businesses through the most violent swings in a generation. The market segment generated more than $5.2 billion in profits last year, up 50% from a year earlier – as Bank of America, like rivals, benefited from the market turmoil caused by the pandemic.
DeMare’s division has also seen senior exits in stocks in the past year. Fabrizio Gallo, the longtime stock owner, left last year after his fixed-income counterpart, DeMare, moved up. The bank has since plucked away from rivals to strengthen its ranks and gain a better competitive edge.
Borthwick, 53, another Goldman veteran, has been with Commercial Banking since 2012. Prior to that, he was co-head of Capital Markets, where he was responsible for equity capital markets, investment-grade debt capital markets, leveraged finance and origination for rates and currencies.
To be sure, there are also several other executives with experience serving clients of investment banks who also sit on the company’s executive committee.
They include Sanaz Zaimi, who oversees the sale of fixed income, currencies and commodities out of Paris and is chief executive officer of BofA Securities Europe. Bernard Mensah, president of the bank’s international operations, was previously co-leader of FICC trading.
Set up promotions
Montag, whose retirement plan was announced Thursday, has been known for his iron grip on investment banking since joining Bank of America during the 2008 financial crisis through its acquisition of Merrill Lynch.
He not only has a hand in promotions on various sports below, but sets bonuses for individual executives and sometimes members of their teams.
He is also known for maintaining important relationships be it chatting with BlackRock Inc. CEO Larry Fink, courting Japan’s biggest banks or partying with Hillary Clinton, John Kerry and Beyoncé at one of the world’s most expensive weddings in India.
Most of his deputies, on the other hand, are known for their managerial style.
The question of who could succeed Montag over the investment bank is made all the more complicated by his plan to step down as chief operating officer for the entire company. It is quite possible that the bank will split the positions, with either or both being filled by more than one person, thus electing a new generation of senior leaders.
But Wall Street is keenly focused on the investment bank, as promotions at the top of those operations would trigger others below, creating winners and losers in the months ahead. Filling Montag’s void will ultimately determine how competitive the bank remains across different business lines.
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