BANK OF America chief executive Kenneth Lewis, facing a vote that could strip him of the chairmanship of the largest US bank, defended his management decisions before thousands of shareholders at the bank’s annual meeting yesterday.

Shareholders voted on a proposal to separate the posts of chairman and chief executive.

The meeting ended after almost four hours without the vote results being announced. A spokesman said the results would be released later yesterday. He said the bank would appoint an independent chairman if a majority of shareholders wanted one.

Mr Lewis (62) heard complaints about the 75 per cent fall in the bank’s share price since the purchase of Merrill Lynch Co on January 1st, and the bank’s failure to quickly disclose huge losses that Merrill was amassing even as it was paying out bonuses to employees.

Judy Koenick, an investor who said she lost $27,000 (€20,400) on the bank’s stock, told Mr Lewis that he and other directors should have stood up to any US government pressure to buy Merrill, even if it cost them their jobs.

“I don’t understand how a code of ethics allows you to say, ‘My job is more important’,” she said. “You knew what was going on with Merrill Lynch, you kept it from us. You’re still keeping it from us.”

In a separate vote, shareholders elected all 18 director nominees, including Mr Lewis, by a “clear margin”, a person familiar with the matter said.

Shareholders packed a theatre in uptown Charlotte, North Carolina, and questioned Mr Lewis, who stood quietly at a podium on a stage, sometimes biting his lip.

In a speech, he defended buying Merrill, saying it was “good value” and that abandoning the deal would have caused “serious harm” to US banks. He also said he saw no need for Bank of America to make further acquisitions.

Bank of America needed a $20 billion federal bailout to absorb Merrill. Mr Lewis has indicated that regulators pushed him to keep quiet about Merrill’s losses and not to back out of the merger.

“They should have disclosed it,” said Ed Morais, a financial adviser and shareholder from Charlotte.

“It seems like he chose to put Merrill Lynch shareholders ahead of Bank of America shareholders.”

Citing shareholder lawsuits, Mr Lewis declined to comment on the thornier issues of the acquisition, which is also the subject of investigations by members of the US Congress and regulators, including the US Securities and Exchange Commission and New York attorney general Andrew Cuomo.

Bank of America has received a total of $45 billion in taxpayer funds and may need more after results of government “stress tests” are released, probably next week. The tests gauge banks’ ability to weather a deep recession.

At the annual meeting, shareholders were anxious to know whether the bank would dilute their holdings by issuing more common stock.

Mr Lewis however declined to discuss details, saying the bank was talking to regulators. – (Reuters)