Bank of America has replaced its Wilmington-based credit card chief, Richard K. "Ric" Struthers, with Susan Faulkner, a 25-year BofA veteran based at the company's Charlotte, N.C. headquarters. Statement here.
Struthers, who held the job running the largest credit card bank for just over a year, "decided to leave the company" when it eliminated his job as president of Global Card Services, BofA said. He was the high-ranking insider to survive from the old executive corps at MBNA Corp., the Wilmington card lender BofA bought for $35 billion in 2006.
The top card job is being combined with BofA's deposit banking business under Faulkner, who reports to BofA's top consumer lending executive, Joe Price.
Struthers "navigated our unsecured lending business through the most significant consumer credit crisis in 50 years," Price said in his statement. "Ric rapidly repositioned the card business, significantly reducing our exposure to credit losses and simplifying our credit card suite by introducing, easy-to-understand, basic products."
So why's he leaving? "Susan is the right executive to operate the combined product unit in a rapidly evolving and challenging environment. Integrating the development of our card and deposit products will help create greater value for customers." She'll get a second office in Wilmington, Price added.
The bank did not immediately respond to requests for comment. BofA has cut thousands of the 25,000 formerly employed by MBNA, nearly half of them in and around Wilmington, the others at offices in Maine, suburban Cleveland and Dallas, among other sites.
Struthers helped land one of MBNA's biggest and earliest clients, Penn State, his college alma mater, for its affinity-card program in the early 1990s. MBNA issued credit cards for tens of thousands of Penn State students and graduates, profiting from their fees and interest rates in exchange for small cash grants to the school's alumni association each year. The pattern, repeated at more than 1,000 colleges, sports leagues, and hobbies and professional groups, made MBNA the largest independent credit card company under founder Charles M. Cawley.
But BofA's credit card business appears to have "lost more money in 2009 than it earned in the previous three years" since the takeover, Rochdale Securities analyst Richard X. Bove told clients in a report today. "The main problem is that the business is saturated and characerized by significant price cutting."
Given similar problems in the home and auto loan businesses, Bove predicted the bank "is likely to go to war with the consumer," by "layering on just every nuisance fee the company can think of to get back lost profits."