[ad_1]
An embattled Bank of America executive was stripped of responsibility over a key money-making division — months after outcry over the headline-grabbing death of an overworked junior banker in his unit.
Gary Howe, the hard-charging boss of the Wall Street giant’s Financial Institutions Group (FIG), lost oversight over the FinTech investment banking team in August, sources told The Post — and Bloomberg reported about the FinTech transfer last week.
Howe’s FIG unit had employed Leo Lukenas III, a 35-year-old former Green Beret who died in May after allegedly logging several 100-hour weeks to help close a multibillion-dollar merger.
Lukenas’ death cast a harsh spotlight on Wall Street’s pressure-cooker culture, leading to intense scrutiny of BofA’s guardrails for junior bankers — and whether managers turned a blind eye to underlings working excessive hours.
The bank said Howe would not face any disciplinary measures immediately after Lukenas’ death.
But last Monday it was reported that roughly 50 of the 150 New York FIG workers in the lucrative FinTech unit were moving to its Technology, Media and Telecommunications (TMT) group, according to Bloomberg.
Star banker Matthew Sharnoff — ranked as the second-highest FIG member last year across all banks in bringing total value of the deals he led, according to Mergerlinks — was among those moved to TMT, sources said.
Kevin Brunner, the bank’s chairman of global M&A and global head of TMT, told the outlet the move was part of an industrywide shift in financial services toward software.
The shrinking of Howe’s team by about a third was interpreted by some as a potential blow to his future at the bank.
“This was a power move against Gary,” a source with knowledge of the bank’s inner workings told The Post, adding that it would be harder for Howe to make a bonus.
Another source close to the bank guessed CEO Brian Moynihan was giving Howe quiet encouragement to show himself out the door.
“Bank of America doesn’t fire people,” the former BofA executive said. “There will be a title change, a drop in pay. I don’t think Gary will be there in six months.”
A labor lawyer speculated that the bank may be trying to distance itself from Howe ahead of any possible lawsuits.
“I’m sure an investigation was done internally,” Tavir Rahman, a partner at Filippatos, who has handled cases against many big banks but is not involved in the Lukenas situation, told The Post.
“I could see him being the fall guy.”
Howe, 54, has not commented since Lukenas suffered a fatal blood clot in his heart on May 4.
There is no evidence that long hours at work contributed to Lukenas’ death.
Howe did not return multiple requests for comment. He disconnected his LinkedIn account shortly after Lukenas died.
“Gary has our full support as leader of our Global Financial Institutions Investment Banking group and we continue to invest in this leading franchise,” said Matthew Koder, head of global corporate and investment banking.
Last week, Howe announced the addition of George Matsuzaka as the co-head of global insurance. He was the global head of insurance at UBS.
In early August, BofA put in place a new monitoring system that forced junior bankers to report their hours daily as opposed to every week, a junior banker who worked with Lukenas told The Post.
The decision came around the same time an explosive Wall Street Journal exposé on how BofA managers told direct reports to lie about their extensive hours even when they exceeded an 80-hour limit — which was put in place more than a decade ago following the death of a 21-year-old intern who worked continuously for three straight days.
“They called me in the middle of the week to say let’s make sure you don’t get to 80 hours,” the junior banker who worked with Lukenas told The Post.
The banker said he had previously put in some 100-hour weeks after pushing back on the limits, which are monitored by executive-level “staffers” who report back to managers like Howe.
“If you work past 2 a.m., you have to flag it to the managing directors on the transaction immediately,” the source said.
“They are trying to change the culture. We’ll see how long it lasts.”
Nevertheless, Howe was also responsible for checking hours, according to the former senior BofA executive.
“Gary gets paid to make sure junior bankers are not overworked,” the former executive said. “If someone was working 100-hour weeks, week after week, it should have raised a red flag.”
Howe earned an MBA at the prestigious Wharton School in 1994. After a brief stint at JPMorgan, he worked for nine years at Credit Suisse First Boston before landing at its Swiss rival UBS in 2005.
During his six-year tenure at UBS in its FIG division he told UBS co-workers that he was a relative of the family behind the De Beers diamond empire, Howe had a reputation of pushing junior bankers hard, according to a source who worked with him at UBS.
“People complained about his attitude, respect for others and the hours he made people work.” a source at UBS said. “People complained about working 100-hour weeks.”
Howe’s fixation on pitchbooks also had raised eyebrows at UBS, with junior bankers spending longer hours than most assembling them – and frequently wondering why, according to the UBS source.
“He seemed to think that one could win business by putting the biggest books together,” the UBS source said of Howe. “We were wasting time doing pitch books that no one would look at and wouldn’t get any business. These books were full of analyses for deals we wouldn’t get.”
UBS passed over Howe when choosing a head of its FIG division in 2011, according to the source. He then landed at Lazard’s FIG unit, Howe earned a different reputation – for not bringing in enough deals, a source with direct knowledge of the situation said. He was forced out in 2019, that source said.
Months later, Howe joined BofA as co-head of its Americas FIG banking. The South African native was promoted in 2021 to run the global FIG division with Will Addas and Georgio Cocini.
Addas, who was more focused on concerns of the rank and file, retired last year to devote more time to his family, according to sources close to the bank.
At that point, the FIG unit became a “rougher department without him” under Howe, according to the junior banker who worked with him.
Indeed, Howe’s first order of business was to enforce the company’s return-to-office mandate following the pandemic, which Addas had been more lax about, the source said.
“When Will left on a Friday, I remember the following Monday we came in and Howe reset the expectation saying we all needed to be in by 9:30am and be in the office four days a week,” the junior banker said.
The source called Howe a tough boss, but also said he, Lukenas and others pushed themselves to get ahead by putting in long hours.
Last month, rival JPMorgan also implemented a cap on junior bankers’ work hours at 80 per week — the first limits enacted by the nation’s largest lender.
In 2013, BofA installed employee safeguards following the death of Moritz Erhardt, a 21-year-old investment banking intern who died of an epileptic seizure after reportedly working almost nonstop for nearly 72 hours.
The new policies barred junior bankers from working more than 80 hours per week unless it was cleared by supervisors and there was an important reason to make an exception, sources said.
They also prevented junior bankers from working on Saturdays or holidays without a sign-off from a chief operating officer, five sources with direct knowledge of the policy said.
“The rules were put in place so what happened to (Moritz) couldn’t happen,” the former BofA executive said.
A former BofA human resources officer added: “I was very involved in ensuring that these young people were leaving at the right hours. We were maniacal about it.”
Two staffers, typically a vice president or director who earns about $350,000 a year for walking the floor and talking with junior bankers and associates, were assigned to the New York FIG unit, with more than half of the 150 workers being junior bankers, sources said.
Lukenas, who lived in Brooklyn with his wife and two young kids, seemed tired of the grueling hours since getting hired in March 2023, according to a recruiter the former Green Beret had contacted two months before his death.
He wasn’t the only stressed-out junior banker at BofA who was searching for an exit plan. Several in Howe’s department were seeking jobs at a rival bank over the past year, a senior banker at that bank with direct knowledge of their calls told The Post.
Lukenas complained about working more than 100 hours a week and having too little time to spend with his family, said Douglas Walters, a managing partner at GrayFox Recruitment, according to Reuters.
“He made a comment saying like, ‘Hey, I’ll trade hours of sleep for a 10% (pay) cut,'” Walters told the outlet in May.
Leading up to his death, Lukenas was working on helping BofA client UMB Financial buy Heartland Financial for $2 billion. The deal closed April 29, three days before Lukenas suffered the fatal blood clot.
“The day before he died there was a group call about the UMB deal and he was excited about getting it done,” the BofA junior banker said.
Despite a lack of evidence that long hours at work contributed to Lukenas’ death, some family members believe it may have been a contributing factor.
“I don’t think any person should work those hours and carry that stress,” one relative told The Post, asking not to be identified.
Howe attended Lukenas’ funeral at Fort Liberty, the US Army base formerly called Fort Bragg, in North Carolina with about 50 other Bank of America employees, according to a source who also attended the funeral.
At the close of the service, US Army officials played a recording of Earth Wind and Fire’s “September,” honoring a request Lukenas had made as a Green Beret in the event that he ever died during a military operation, the source added.
