PEOPLE : B of A Chief Coy About When He Will Retire
As the guard continues changing at California’s top banks, the question increasingly asked these days is when BankAmerica Chairman A. W. (Tom) Clausen will retire.
Speculation about Clausen’s retirement plans have been building for a year, picking up the past week in published reports in San Francisco. Conventional wisdom has Clausen announcing his retirement before the bank’s May 24 annual meeting, with Vice Chairman Richard M. Rosenberg getting the top job and Chief Financial Officer Frank N. Newman moved up to second-in-command.
For his part, Clausen leaves it an unanswered question. In an interview this week in his office at the San Francisco bank’s headquarters, the two-time BankAmerica chief executive even hinted that he might choose to stay another year if BankAmerica’s directors ask.
“I’d say the board is kind of unpredictable, and so am I on that. I’m not going to be here forever, but no one is counting the days,” Clausen said.
Clausen did say that retirement is “a lot closer today than it was a year ago.” But he also was quick to add that the bank’s board will ultimately decide.
No one would be surprised if Clausen retires as chief executive this year, if for no other reason than he turns 67 on Feb. 17.
Furthermore, the turnaround he was brought in during 1986 to engineer is largely complete. Last week, the once-troubled parent of Bank of America disclosed that it earned a record $1.1 billion in 1989. On Monday afternoon, Clausen addressed BankAmerica’s staff, calling 1989 a “vintage year.”
Rosenberg, a former Wells Fargo executive, is 59, an age at which he could take over the banking company and run it for a good five years or so. Although he lacks much international banking experience, he led BankAmerica’s successful assault on the lucrative retail banking business, which involves credit cards, home equity loans, mortgages and car loans. Many analysts say Rosenberg and Newman deserve as much credit as Clausen for engineering BankAmerica’s turnaround.
Rosenberg also has a clause in his BankAmerica contract that would pay him close to $1 million should he quit voluntarily before Dec. 1, an additional incentive for the bank to act to elevate him now. (Rosenberg’s cash compensation in 1988 was $975,000, according to BankAmerica’s last proxy statement; Clausen’s was $1.5 million).
But Clausen is coy in answering questions about his plans. He is known to be secretive regarding his personal affairs, leaving many inside and outside the bank to look for subtle signs about his moves.
Interest in Clausen’s future has been especially keen amid changes announced last week at two of the four largest California banks.
Security Pacific Corp. Chairman Richard J. Flamson III stepped down as chief executive of the Los Angeles banking company last Tuesday to be succeeded by Robert H. Smith. A day later, First Interstate Chairman Joseph J. Pinola disclosed that he will retire June 1, to be succeeded by Edward M. Carson. Wells Fargo Chairman Carl E. Reichardt has no immediate retirement plans.
Some analysts are reluctant to declare Clausen gone because he can change his mind. He is known to have agonized when tapping his first heir, Samuel H. Armacost, over Leland S. Prussia, before retiring the first time in 1981. Armacost was later forced out in 1986 amid mounting problems with bad foreign loans, a bloated staff and management foul-ups, and Clausen was brought back.
Clausen praises all of the likely candidates, calling Rosenberg a “remarkable marketer” and Newman a “world-class chief financial officer.” Then he ticks off the names of a number of other executives he considers important to the turnaround, including Vice Chairman Glenhall Taylor Jr.
