Hugh McColl, a South Carolina native and resident (Bennetsville, SC), the iron-fisted CEO who crafted juggernaut that is Bank of America is either wringing his hands in nervousness or joy.
The Wall Street Journal has announced that BOA has reached a deal to purchase Merrill Lynch.
CEO Ken Lewis took over BOA when McColl retired in 2001. In the years that have passed he's not wavered far from McColl's war like approach to finance though he has become more cavalier in efforts. As the WSJ article says:
The integration of Merrill, known for its proud, and sometimes testy, brokerage force, could turn out to be the biggest test of Mr. Lewis's career. Typically, the bank has made one big deal and then taken time to carefully merge the two institutions. But in recent years, acquisitions have come at a furious pace. In 2004, the bank bought FleetBoston Financial Corp. A year later, the bank agreed to buy MBNA Corp., the credit-card firm. In 2007, Bank of America bought Chicago's LaSalle Bank as part of the break-up of Dutch bank ABN-Amro Holding NV. Then came this year's purchase of Countrywide.
With great risk comes the possibility of great reward. As the article suggests, the merger would create an institution that has it's hands in the cookie jar of almost every aspect of the financial system, "from credit cards and auto loans to bond and stock underwriting, merger advice and wealth management," not to mention insurance services, mortgages, adn the other traditional banking services.
Unlike Bear Sterns which, retrospectively, the government should have left laissez-fair but didn't, and now Lehman Brothers which they are, the Charlotte based financial giant is moving percipitously further into the realm of "to big to allow to fail," much like Fannie Mae and Freddie Mac, the quasi-public-private mortgage giants that were nationalized.
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