Did Warren Buffett Save Moynihan’s Role as CEO and Chairman at Bank of America?

Earlier this month, Buffett, of Berkshire Hathaway Inc. (NYSE: BRK-A), threw his vocal support to Moynihan. Buffett has a solid stake in Bank of America, but his stake is non-voting as a convertible preferred stake. Still, it is assumed that if Buffett were to call that they wouldn’t just put him on hold and not even pick up the phone.

While Bank of America shares were lower after the news, the reality is that its shares were already negative due to a much lower stock market on Tuesday.

It turns out that Bank of America had 63% of the votes in support of Moynihan, who was named as both CEO and chairman in 2004. Back in 2009, shareholders voted to split the chairman and CEO roles.

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Changes of this nature can be extreme on the surface, but they are not unprecedented. Jamie Dimon is perhaps the best known name in banking today. There had been a proposal to split Dimon’s chairman and CEO roles before as well, which has so far failed to gain traction as shareholders voted to keep Dimon firmly in both roles. Buffett has voiced emphatic support for Dimon as well in the past, although Berkshire Hathaway’s official bank holdings do not include shares of JPMorgan.

This vote to keep Moynihan as chairman and CEO simultaneously does matter. Bank of America has been prevented from getting too aggressive on its dividend due to stress test reviews. That may now pass, but it remains unfinished business to date. The bank has been repurchasing common shares and likely will continue to do so.

This also may act as a blow to proxy advisory firms. ISS had urged Bank of America shareholders to re-split the role of CEO and chairman. Pension funds CALPRs and CALSTRs were both leading this charge to split the roles again here too.

Bank of America shares were last seen down 1.3% to $15.50, within a 52-week trading range of $14.60 to $18.48. The bank’s stock has a consensus analyst target price of $19.22.

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