Bank of America (NYSE: BAC) closed at $8.68. BAC said shareholders voted to remove Kenneth Lewis of his duties as chairman, he will continue as chief executive. BAC May option implied volatility is at 137; June is at 130; above its 26-week average of 122; according to Track Data, suggesting large price movement.

Financial Select Sector (NYSE: XLF) closed at $10.88. XLF top holdings in the fund are JPM, WFC, BAC, GS, USB, C, MET, TRV and AXP. XLF over all option implied volatility of 64 is below its 26-week average of 69, according to Track Data, suggesting decreasing price movement.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.

Investors have had little reason to be hopeful during the past two years as the economic news seems to get more depressing by the day. But lately, the stock market has turned optimistic and investors begin the week bracing themselves for any word that the good times may not last.

Stocks appear poised to open higher as Express Scripts Inc. (NASDAQ: ESRX) agreed this morning to acquire Wellpoint Inc.'s pharmacy benefits management business for $4.68 billion, proving that the once-moribund mergers and acquisitions market is showing signs of life.

A report today in the New York Post suggests that shareholders are anxious to oust Kenneth Lewis, CEO of Bank of America Corporation (NYSE: BAC). The paper says that a group of angry investors, spearheaded by Jerry Finger, has compiled a list of demands to present at the bank's next annual meeting. Finger and his irate mob will request that the roles of CEO and chairman be split, and the outspoken investor said it's safe to assume that a brand-new chief executive is also high on his wish list.

Finger made headlines last month by filing a class-action lawsuit against B of A, alleging that its merger with Merrill Lynch failed to protect shareholders' interests. New York Attorney General Andrew Cuomo is now investigating that very same matter, and reports say that the AG may demand the return of $4 billion in bonuses to Merrill employees that were rushed through prior to the merger's completion.

Bank of America (NYSE: BAC) CEO Kenneth Lewis has received the dreaded vote of confidence from his company's board of directors.

In a statement, Bank of America lead director Temple Sloan said that "The board today during their regular meeting expressed support for Ken Lewis and the management team, noting their experience in managing through challenging environments and in assimilating mergers."

Is Mr. Sloan on crack? Ken Lewis has presided over an acquisition-fueled destruction of shareholder value that is almost without precedent in the history of the world. If Mr. Lewis has experience in assimilating mergers, it is only because he has made so many boneheaded acquisitions.

Bank of America (NYSE: BAC) posted 2008 net income of $4 billion, down from $15 billion in 2007. Its fourth quarter revenue was up 19% to $15.98 billion from $13.45 billion in 2007. But last fall Bank of America agreed to acquire Merrill Lynch -- which had a fourth-quarter net loss of $15.31 billion. And as an apparent condition of closing the Merrill deal, Bank of America has demanded and received about $120 billion from the government ($20 billion + the part of the $118 billion absorbed by the government).

The terms of Bank of America's deal mean the government will inject an additional $20 billion into Bank of America -- raising its holdings to $45 billion and making its 6% stake the single largest one. The government will also guarantee part of a pool of $118 billion in illiquid assets, including residential and commercial real estate and corporate loans. Bank of America will be responsible for the first $10 billion in losses; the Treasury and the FDIC will take on the next $10 billion in losses. The Fed will absorb 90% of any additional losses, with Bank of America responsible for the rest.