The Finger Family, based in Houston, owns more than 1 million shares of Bank of America (NYSE: BAC) and has risen to express its opinion about who should be the company's new CEO: someone from outside the company.
In a letter to the company's shareholders filed with the SEC, the Finger family raised a number of fantastic points about why promoting from within is a horrible, horrible idea. In a way, it's so obviously not the way to go that it's a tribute to the board's incompetence that this discussion even has to be had. But here are a few of the Finger family's points:
- The current management team is tainted and not credible.
- Can the board be certain neither individual will be charged with wrongdoing?
- Change the status quo -- hold current management team accountable.
- This management team has been exposed as an underperformer.
There's more detail in the letter, and it should be required reading for all Bank of America shareholders. But perhaps the most important point they make is that because of the huge number of federal and state investigations of the company's conduct, it's possible that any internal candidate could be indicted at some point -- making finding an outsider an absolute necessity.
The Finger Family should be applauded for standing up and taking an active role in maximizing the value of their investment. If we had more investors like the Fingers, we probably wouldn't have gotten into this financial crisis in the fist place.
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