Without commenting on the departure of John Thain, Bank of America issued the following press release on his replacement. It is believed that Thain was forced to resign following the announcement of the US$ 15 billion in losses in the 4th Qtr and after publication that Thain had brought forward to December of last year the payment of bonuses for his division. It is believed that bonuses in excess of US$ 4 billion were paid prior to year end. The New York attorney general has begun an investigation into the bonus payments.
CHARLOTTE, N.C., Jan. 22 /PRNewswire/ -- Bank of America today announced that Brian Moynihan has been named President of Global Banking and Global Wealth and Investment Management.
Moynihan replaces John Thain who is leaving the company.
The company also said that Tom Montag will continue to run Global Markets and will now report to Ken Lewis, Bank of America chairman and chief executive officer. Montag will also become a member of the Management Executive Team, which sets strategy for the company.
Moynihan has been General Counsel of Bank of America. He will occupy that role while the company searches for his replacement. Previous to the merger with Merrill Lynch, Moynihan ran Global Corporate and Investment Banking for Bank of America. Before that, he was President of Global Wealth and Investment Management at the company.
"Brian Moynihan is a strong manager and one of those people who can effectively envision strategy and execute," said Ken Lewis, Bank of America chairman and chief executive officer. "He has excelled at everything we have asked him to do." Lewis emphasized that the change in leadership in no way reflects a significant change in direction for the Global Banking or wealth management units.
"Those organizations, which formed the heart of Merrill Lynch, will continue to serve their clients as world class financial service providers," Lewis said. "We are quite happy with their performance since the merger."
Lewis added that, "Tom Montag is getting a well-deserved promotion. He has provided strong leadership during our transition so far, and we believe that Global Markets will in the future be a significant profit center for our company."
Moynihan, 49, continues to report to Lewis and be a member of the company's Management Executive Team. He joined Bank of America in 2004, following Bank of America's merger with FleetBoston Financial. At Fleet, he led Brokerage & Wealth Management after leading Fleet's Internet strategy. Before that, he directed the corporation's strategic development for six years, overseeing all mergers and acquisitions. He joined Fleet Financial Group in April 1993 as Deputy General Counsel.
Montag, 52, joined Merrill Lynch as executive vice president and head of global sales and trading in 2008, prior to the company's merger with Bank of America. Before that, he was with Goldman Sachs Group, Inc., where he was co-head of the global securities business and a member of the company's Management Committee and Equities/FICC Executive Committee. During his 22 years with Goldman Sachs, Montag was co-president of the firm's Japanese operations and co-head of Asian FICC and Equities, before becoming co-head of the global securities business. Earlier in his career, Mr. Montag ran the firm's global derivatives business.
Thain looks as bad as the rest of them. Another senior executive at a financial institution that is just greedy.
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January 23, 2009
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Merrill Lynch & Co Inc. is a holding company that provides investment, financing, insurance and related services to individuals and institutions on a global basis through its broker, dealer, banking, insurance and other financial services subsidiaries. On September 29, 2006, Merrill Lynch completed the merger of its Merrill Lynch Investment Managers (MLIM) business with BlackRock, Inc. (BlackRock) (the BlackRock merger). The Company owns a 45% voting interest and approximately half of the economic interest of BlackRock.
John Thain has stated that his office redecoration was a mistake and he has said he will reimburse the company the US$ 1.2 million.He also said that the losses if the final quarter were all from legacy positions and that B of A had known about them at the time they bought Merrills. The losses arose towards the end of the quarter and B of A were informed as soon as they arose. He also stated that B of A management was consulted on the bringing forward of bonus payments.After taking on the role as head of Merrill Lynch, John...
Without commenting on the departure of John Thain, Bank of America issued the following press release on his replacement. It is believed that Thain was forced to resign following the announcement of the US$ 15 billion in losses in the 4th Qtr and after publication that Thain had brought forward to December of last year the payment of bonuses for his division. It is believed that bonuses in excess of US$ 4 billion were paid prior to year end. The New York attorney general has begun an investigation into the bonus payments.CHARLOTTE, N.C., Jan. 22 /PRNewswire/ -- Bank of America...
After being acquired by Bank of America at the beginning of the fourth quarter of 2008, Merrill Lynch produced an after tax loss of US$ 15.450 bn. The Merrill Lynch losses brought Bank of America to a quarterly loss of US$ 1.8 billion
NEW YORK, December 5, 2008 – Merrill Lynch & Co., Inc. (NYSE: MER) announced that Bank of America’s acquisition of Merrill Lynch was approved today at its special stockholders meeting along with two other related proposals. Under the terms of the transaction, which was announced on September 15, 2008, Merrill Lynch stockholders will receive 0.8595 of a share of Bank of America common stock for each share of Merrill Lynch common stock held immediately prior to the merger and Merrill Lynch & Co., Inc. will become a wholly-owned subsidiary of Bank of America Corporation. The acquisition is expected to close...
NEW YORK, October 16 – Merrill Lynch (NYSE: MER) today reported a net loss from continuing operations for the third quarter of 2008 of $5.1 billion, or $5.56 per dilutedshare, compared with a net loss from continuing operations of $2.4 billion, or $2.99 perdiluted share, for the third quarter of 2007. Merrill Lynch’s net loss for the third quarterof 2008 was $5.2 billion, or $5.58 per diluted share, compared with a net loss of $2.2billion, or $2.82 per diluted share, for the year-ago quarter.Third quarter 2008 net revenues were $16 million, driven by a number of significantitems, including:• Net write-downs...
Current Merrill Lynch share price link click here.
Recent Events -Merrill Lynch
Full Year Loss and Recapitalisation
On 17 January 2008, Merrill Lynch reported a net loss from continuing operations of US$ 8.6 billion for the full year 2007.The results were dramatically impacted by net write-downs in the 2nd half of 2007 of US$ 19.4 billion relating to U.S. ABS CDOs and US sub-prime residential mortgages.In addition to the write-downs, credit valuation adjustments of US$ 2.6 billion relating to hedges with financial guarantors on U.S. ABS CDOs were recorded in the final quarter.
Significant Failures
The recently appointed Chairman and Chief Executive, John Thain, has been explaining to analysts and investors that the profit hit was caused by a number of significant failures including poor risk management on the trading desks, the increased siloing of the business over the last few years with not enough control from the top, lack of collaboration across the firm, insufficient management of the balance sheet and an inappropriate incentive scheme.He has announced significant initiatives to address these issues including new senior hires, a weekly across the firm risk management meeting, a more focused allocation of risk and an incentive plan firmly based on overall company performance and a greater proportion of incentives to be paid to employees in the form of stock.
Capital Raising
The company has raised additional capital through a US$ 6.6 billion mandatory convertible preferred stock issue in the form of a private placement mainly to the Korean Investment Corporation, the Kuwait Investment Authority and Mizuho Corporate Bank, This was in addition to the US$ 6.2 billion private placement of newly issued common stock to Temasek Holdings and Davis Selected Advisors.
Executive Compensation
Shareholders are obviously upset that the stock price has fallen by around 40% over the last year.In addition, many have expressed concern that the previous Chairman and Chief Executive, who presided over many of the above listed failures, has been allowed by the Board to resign with an estimated final compensation package of US$ 160 million.
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