Mukesh Ambani stepping down from BofA Board

Thursday, 21 March 2013 00:00 - - {{hitsCtrl.values.hits}}

REUTERS: Bank of America Corp said on Friday that Mukesh Ambani, Chairman of Reliance Industries Ltd., will step down from the No. 2 US bank’s Board of Directors at its annual shareholder meeting in May.

Ambani joined Bank of America’s board in March 2011, bringing global experience to a bank known for its US consumer business. He will take a seat on the bank’s new, non-fiduciary global advisory council made up of 13 business, academic and policy leaders.

Ambani, 55, joins former Morgan Stanley executive Robert Scully in announcing plans to leave Bank of America’s 18-member board this spring. The bank has added six directors since August in anticipation of planned departures, including by board members reaching the traditional retirement age of 72.

The board is undergoing a major overhaul, and has made progress in resolving mortgage-related lawsuits and building capital. Investors are watching Chief Executive Brian Moynihan to see if he will deliver promised expense cuts and loan growth.

On Thursday, the US Federal Reserve gave the bank permission to buy back $5 billion in common stock and $5.5 billion in preferred shares after approving its capital plan as part of the annual stress test of large banks. A bank spokesman said Ambani’s departure was a “personal decision”. The Charlotte, North Carolina-based bank has not disclosed who else may leave the board this spring. Three directors are age 71 or older, according to the company’s website.

The board last experienced a major shift in 2009 when federal regulators pressed the bank to add more directors with financial expertise. If former Federal Deposit Insurance Corp Chairman Don Powell, 71, departs, only two of the six directors added in 2009 will remain.

The six board members added since August include current and former chief executives in industries ranging from defense to healthcare. Bank of America’s shares rose 3.8% to $12.57 on Friday, a day after the stress test results. The shares are up 8% this year.