Looking for Mr. or Ms. Right

Friday morning's announcement of weak third-quarter earnings—including a loss and missed forecasts—marks yet another blow for beleaguered Bank of America. But CEO Ken Lewis may have had a quieter than usual morning, as attention was not directed at him. The beleaguered CEO has been embroiled in conflicts with regulators and Congress and even agreed to pay back all of the salary he's earned this year. Lewis announced in early October that he will be stepping away from Bank of America by the end of the year. But more than two weeks after announcing his retirement, the bank's board still hasn't named a successor—someone who might be able to help it rebound from its rough spell.

Getting Lewis out of the way will clear the path for a new CEO to deal with the financial, cultural, and legal issues facing Bank of America. But the October timing of Lewis's retirement seems to have left Bank of America flat-footed, even though they have had plenty of time to think about it. At an April shareholder meeting, Lewis was able to cling to his job but was stripped of his chairmanship Since then, Lewis's departure was seen by many BofA watchers as a matter of when, not if. Despite the anticipation, the bank has not named a successor. A report on Oct. 6 said the board would name an emergency interim CEO if legal troubles force Lewis to step down before December 31 as planned. But still no interim CEO has been named.

Speculation on who will replace Lewis abounds. Most of the spotlight has focused on BofA veterans Brian Moynihan, Sallie Krawcheck, and Thomas Montag. All three were among those moved around in a shuffle last month that Lewis said would "position a number of senior executives to compete to succeed me at the appropriate time."

"Ideally you like to do these [transitions] simultaneously," says Anthony Polini, an analyst at Barclay's Capital. "You don't need someone to change world. The business model is viable." But the lag highlights the complications Bank of America faces in hiring a new chief. The ideal candidate needs to be a good public face for the firm's image, which has been damaged, but also a good risk manager who can understand a huge bank. He or she would also leave behind the top-down style Lewis espoused, while also meshing with the culture of the Charlotte, N.C.–based bank, which likes to identify itself more with Main Street customers than Wall Street executives.

"I think it needs to be a Charlotte type of person," says Nomi Prins, a former investment banker and author of It Takes a Pillage. "It can't be someone who's going to be just a consumer banker and let whoever's running divisions like Merrill Lynch gloss over numbers. What would be bad for everyone involved would be to have someone run it like an investment bank, but you need someone who understands Wall Street."

In that respect, Brian Moynihan has the inside track—Polini put the odds at 2 to 1 that he will take over. It isn't the first time his name has come up: he was mentioned as a potential chief as early as April, when it was unclear whether Lewis would hold on to his post. Lewis tapped Moynihan, an attorney, to head Merrill in January, but he was shifted to lead consumer banking in August. That puts him in a powerful position atop the bank’s core division, but that group is struggling, and Prins says he might be most valuable to Bank of America if he stays in that job and shores up the division's operations. Moynihan is also something of an outsider; he joined the firm in 2004 when it bought FleetBoston Financial Corp.

Sallie Krawcheck, the head of wealth management, is also said to be a contender. She replaced Moynihan in the August shuffle. Before coming to Bank of America, she was chief financial officer at Citigroup but left in a dispute over whether the company should reimburse clients burned by the hedge funds that Citi had pushed. Her pro-consumer stance could end up giving her an edge at a bank that could sorely use some good publicity. Still, she has her share of weaknesses. Polini says she is talented but "not at all qualified" to run the bank only a few weeks into her tenure. Furthermore, she has just begun efforts to remake Merrill Lynch, recently launching a $20 million marketing campaign for the brokerage. Like Moynihan, her greatest value might be in her current job. She's also a consummate Wall Streeter. At a press conference on Oct. 5, Krawcheck refused to answer questions about her candidacy for the job, but she did position herself as an executive who is comfortable at the bank. "I speak wealth management, I speak bank, and I speak Southern," she said, pointing out that she was raised in South Carolina and attended the University of North Carolina at Chapel Hill.