CFO Departure Hurts Bank of America Shares
Shares of Bank of America declined Monday, with some analysts surprised by news that the bank's popular chief financial officer will resign.
The company on Friday said its chief financial officer, Al G. de Molina, will resign at the end of the year and will be succeeded by fellow executive Joe Price on Jan. 1.
De Molina, who was named to the position 15 months ago, said he wants to pursue other business opportunities. Analysts speculated that de Molina is leaving because he wants to try running a company, an opportunity that might not soon present itself at Bank of America.
"We believe the CFO role is crucial, and given our respect for Al this is clearly a negative and surprising development," wrote Citigroup analyst Keith Horowitz in a client note. He has a "Buy" rating on shares. De Molina's strength was in communicating with investors, the analyst wrote.
Credit Suisse analyst Christopher Mutascio, who has an "Outperform" rating on shares, likewise said de Molina is well liked by analysts for his candor.
"His sudden departure after taking on the role of CFO roughly a year ago will take many by surprise and could certainly conjure up concerns about the quarter," wrote Mutascio.
But Merrill Lynch analyst Edward Najarian, who has a "Buy" rating on shares, said he doesn't expect the CFO change to affect the company's finances or structure.
"While this news could cause BAC shares to decline on Monday, we expect any weakness to be modest and short-lived," wrote Najarian.