Bank of America Overhauls Executive Ranks

Updated from Tuesday, Sept. 6

NEW YORK ( TheStreet) -- Bank of America ( BAC) Tuesday named David Darnell and Tom Montag to newly created co-chief operating officer positions as part of a management shakeup that includes the departure of two high-profile executives, Joe Price and Sallie Krawcheck.

The changes are effective immediately. Darnell is responsible for businesses that impact individual customers, while Montag will handle operations serving companies and institutional investors.

"Today is a significant step in the continued transformation of our company," said Brian Moynihan, Bank of America's chief executive officer, in a statement. "David and Tom are leaders skilled at driving profitability and growth by focusing their businesses on all we can do for customers. They are accountable now for delivering our entire franchise to all our customers and clients."
Sallie Krawcheck

Price, a longtime Bank of America executive, had served as president of Global Consumer and Small Business Banking, and Krawcheck was president of Global Wealth and Investment Management. Krawcheck had joined Bank of America after a long career at Citigroup ( C), where she had been chief financial officer and head of its Smith Barney unit, among other positions.

Moynihan said that the moves announced Tuesday are part of the company's Project New BAC, which began in April. He expects the first phase of the reorganization to be completed in "coming weeks" and anticipates "significant expense reductions" at that time. The second phase is slated to begin in October and conclude in March 2012.

"There is hard work ahead to finalize and implement our New BAC decisions from among the hundreds of thousands of ideas employees have submitted," said Moynihan. "Only by streamlining and focusing our resources behind our customers will we truly deliver on the promise of what we have built."

A comment from Price in the press release was particularly illuminated as he said Moynihan made "some hard decisions" and that during development of the reorganization plan "it became evident that streamlining could be done at the top as well as throughout the organization."

Bank of America shares closed Tuesday at $6.99, and the stock ticked up 2 cents to $7.01 in after-hours action on volume of more than 2 million. The stock rose to $7.14 in premarket trading Wednesday.

Year-to-date, the shares have fallen 47% as the bank continues to deal with toxic mortgage assets from its acquisition of Countrywide Financial and struggles for topline growth.

The stock stabilized of late as the Dow component took steps to shore up its balance sheet by securing a $5 billion investment from Warren Buffett and selling half of its stake in China Construction Bank.

-- Written by Michael Baron in New York.

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Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

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