BofA names Faiz Ahmad, Mike Joo as new co-heads of investment banking, memo says

Bank of America has appointed Faiz Ahmad and Mike Joo as co-heads of global investment banking, a significant leadership reshuffle following a 9% decline in Q2 investment banking fees to $1.4 billion, which lagged rivals. While the bank maintained a third-place ranking in global investment banking revenue with a 6% market share (down from 6.1%), it fell in M&A rankings. The new leadership, with Joo continuing to prioritize the expanding U.S. middle market, aims to address performance and deepen client relationships, as former heads Alex Bettamio and Thomas Sheehan transition to chairs of GCIB.

Analysis

Bank of America's appointment of Faiz Ahmad and Mike Joo as co-heads of global investment banking represents a significant leadership reshuffle aimed at addressing recent underperformance. The move follows a challenging second quarter where the bank's investment banking fees declined 9% to $1.4 billion, a figure that lagged key rivals. While the bank maintained its third-place ranking in global investment banking revenue, its market share contracted slightly to 6.0% from 6.1% year-over-year. This was compounded by a drop in its M&A league table ranking from fourth to fifth and a slight decline in equity capital markets share, though these weaknesses were partially offset by market share growth in debt capital markets and loans. The new leadership structure, which moves the former heads into client-focused chair roles, signals a strategic pivot. A key component of this new strategy is Joo's continued focus on the U.S. middle-market, a segment identified as an expanding business, suggesting an effort to drive growth through better integration across local markets.

Key Decisions for Investors

• Investors should monitor Bank of America's upcoming quarterly investment banking revenue and market share data, particularly in M&A and equity capital markets, to evaluate whether the new leadership is successfully reversing the recent underperformance.
• Pay close attention to any management commentary or metrics related to the U.S. middle-market business, as its performance is a key pillar of the division's stated growth strategy under the new co-head.
• Given that the bank's Q2 fee decline lagged peers, it is crucial to continue benchmarking BAC's investment banking performance against key rivals in subsequent quarters to gauge the effectiveness of this restructuring.