Monday, June 2, 2008

Wachovia CEO given the Boot

The dirty laundry list appears to be almost endless, aiding telemarketers to steal money from account holders, money laundering investigations, selling customer lists, and a host of other activities that have Wachovia in trouble with regulators. Now all the problems have caught up with America’s most ethically challenged bank, CEO Ken Thompson of Wachovia has been shoved out the door.

Certainly the very poor acquisitions of mortgage companies such as Golden West also played into the decision. The resulting financial fallout has left Wachovia in state where it may need to further cut dividends and re-structuring.

"No single precipitating event caused the board to reach this decision, but a series of previously disclosed disappointments and setbacks cumulatively have negatively impacted the company and its performance," Smith said. It would be better to hear commentary on how Wachovia will in the future stay out of trouble with regulators and customers.

An earlier Hingefire article asked when the CEO would walk the plank (see Wachovia: Take Three Steps), now the board has taken steps to right the ship. The question remains if the directors can find a CEO candidate that has the moral backbone to place the bank back on course.