Thompson is made to take one for the team.

• Position: Charlotte

If your mother says she loves you, aspiring journalists are often told, don't take her word for it. Check it out. Investors would do well to treat announcements from Charlotte-based Wachovia Corp. with similar skepticism. In April, the bank cut its dividend by 41 %--after executives promised it wouldn't. In May, it stripped Ken Thompson, 57, of his chairman role in response to the the bank's $350 million first-quarter loss and alleged regulatory indiscretions. That left him free, so he said in official statements, to devote more time to fixing the company. Less than a month later, the board announced that his time had run out and handed his other title, CEO, to Lanty Smith, who had been a Wachovia director for more than 20 years and chairman for a month.

Repeatedly contradicting oneself is rarely a good strategy, and it's particularly risky for a bank trying to weather choppy economic seas. "They have to stop reversing themselves on major decisions like this," says Tony Plath, associate professor of finance at UNC Charlotte, "or they'll lose all credibility." What's left is pretty shaky. Following news of Thompson's forced retirement, Wachovia's shares--already worth less than half what they were a year earlier--slid to a 13-year low. Some analysts predicted disastrous second-quarter earnings would follow.

So what can the country's fourth-largest bank do to redeem...