Bank of America's Lewis braces for shareholder wrath

(MarketWatch) -- Ken Lewis, the beleaguered chief executive at Bank of America Corp., will face a closely watched proxy vote at the company's annual meeting on Wednesday when shareholders decide whether he keeps his board seat as chairman at the banking giant.

There should be plenty of angry shareholders and protest signs at Bank of America's annual meeting in Charlotte, N.C.

Shareholders will vote on the election to the board of a slate of 18 nominees, including Lewis, who is both CEO and chairman. There will also be a vote on whether the post of chairman should be independent.

Lewis has taken considerable flack over the precipitous drop in shares of Bank of America and its most recent ambitious acquisitions: mortgage lender Countrywide Financial and troubled broker Merrill Lynch.

Several shareholder groups and proxy advisers such as Change to Win Investment Group and Risk Metrics have lobbied to vote against Lewis, O. Temple Sloan -- the board's lead director -- and other directors. They have accused Lewis of "empire-building" as well as a shotgun wedding with Merrill in which he failed to disclose risks of the 2008 deal to shareholders.

On Tuesday, a group of seven labor unions said they want the bank to prohibit brokers from casting director-election votes on behalf of investors that don't vote themselves, when shareholders consider the Lewis' fate Wednesday.

The group is focusing its attention, in part, on so called broker-non-votes. In many cases, retail investors don't vote in corporate director elections. Typically, brokers that hold these shares for investors automatically vote the uninstructed stake for the management-backed director slate.

In a letter to Bank of America's board, Change to Win contends that roughly 25% of votes scheduled to be cast at the annual meeting will be "broker votes" based on trends from previous years.

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