'Bank Doctors' Helping BofA Get Back on Track
In deciding how to trim costs, Bank of America turned to two outside consulting firms known as "bank doctors," the New York Times reports. EHS Partners and the Promontory Financial Group have a long history of helping financial firms turn themselves around - including a similar effort at Fleet Financial Group in Boston prior to its acquisition by Bank of America. Current BofA CEO Brian Moynihan has known the lead consultants at these two "bank doctor" firms for more than a decade, according to the New York Times. On the Fleet project in 1994, EHS Partners and Promontory Financial Group "worked with a team of 50 internal managers known inside the bank as the "Nifty 50." One of those 50 managers was a budding young lawyer named Brian T. Moynihan. At Fleet, the consultants recommended cutting Styrofoam coffee cups that cost the company $48,000 a year. Name-brand toner for Fleet's laser printers was replaced with a generic toner to save $200,000 a year." Bank of America this week announced the first phase of its cost-cutting plans, focusing on the retail side of the bank. "Low-hanging fruit," as one analyst tells the Times. The next phase will focus on Bank of America's commercial banking and wealth management divisions. Read more from The New York Times.