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September 7, 2011
By Steven Greer
The Bank of America’s CEO Brian Moynihan made some managerial changes today. He promoted two executives, Tom Montag (head of institutional banking or “Wall Street” banking) and David Darnell (to be head of consumer banking), to the position of co-COO, while firing Sally Krawcheck (head of wealth management) and Joe Price (head of consumer banking). With Moynihan likely to be fired himself, one of these new co-COO’s will likely be the new CEO, and the mostly likely one is Tom Montag.
BatteryPark.TV has been critical of Ms. Krawcheck. She was CFO at Citigroup while that bank accrued massive amounts of toxic mortgage-backed securities.
Not reported in the press, however, is that Mr. Montag was the man behind the infamous “shitty deal” quote by Senator Levin over and over during the Senate hearings on Goldman Sachs. Montag made those comments while he was at Goldman Sachs and was referring to the “Timberwolf” CDOs deal. Goldman was shorting the mortgage-backed securities called Timberwolf while selling the “shitty deal” to clients as long positions.
In 2008, right before the Wall Street banks crashed required the TARP bailout, Mr. Montag was recruited from Goldman Sachs by another ex-Goldman alumnus, John Thain, who was then the CEO of Merrill Lynch. The guaranteed package made Montage tens of millions of dollars despite the TARP bailout and Merrill Lynch having to be saved by the Bank of America acquisition.
Now, the entire Bank of America, and Merrill Lynch as part of it, is on a lifeline and could go bankrupt if the true value of the toxic mortgages and securities are accurately valued. But the savvy Mr. Montag keeps rising. He is now the odds on favorite to become the new CEO of Bank of America. That is crony capitalism at its finest.