John Thain, an MIT-trained engineer, will have to mend morale and overhaul risk controls as head of the world's biggest brokerage. He may also have to write off billions more in bad debt.
By Lisa Kassenaar and Yalman Onaran
Bloomberg Markets February 2008
The markets have just closed on the first Monday in December when John Thain pays a visit to Merrill Lynch & Co.'s seventh-floor bond trading room, with its 550 seats and 1,000 computer screens.
The company's new chief executive officer, who has been on the job for 48 hours, tells the crowd he's honored and a little nervous to be in charge of the world's biggest brokerage. Then he breaks into a story about a phone call from David Komansky, the former broker who ran Merrill from 1997 to 2002.
"David Komansky called me up and he said, 'I can't believe a Goldman guy is going to be in my office,"' says Thain, 52, adopting a low, gruff Bronx accent to mimic his 68-year-old predecessor. He pauses for the laughter and applause to die down. "Well, I'm not a Goldman guy anymore," he says.
He certainly isn't. While Thain's old employer, Goldman Sachs Group Inc., has emerged from the subprime crisis relatively unscathed, his new firm, Merrill Lynch, had to take a $7.9 billion writedown on its mortgage-backed assets, one that cost Thain's predecessor, Stan O'Neal, his job.
The 6-foot (1.8-meter) Thain, who learned risk management at Goldman and consensus building as CEO of the New York Stock Exchange, will need all of his skills to repair 94-year-old Merrill.
Thain is moving swiftly to restore order. On Monday, Dec. 3, the new boss chaired an all-day board meeting. That day, he also handed Nelson Chai, his chief financial officer from NYSE Euronext, the same job at Merrill.
Like many people who know Thain, Chai praises the newcomer's high- wattage intelligence: Thain holds a degree in electrical engineering from Massachusetts Institute of Technology and a Master of Business Administration from Harvard Business School.
http://www.bloomberg.com/news/marketsmag/mm_0208_story1.html
By Lisa Kassenaar and Yalman Onaran
Bloomberg Markets February 2008
The markets have just closed on the first Monday in December when John Thain pays a visit to Merrill Lynch & Co.'s seventh-floor bond trading room, with its 550 seats and 1,000 computer screens.
The company's new chief executive officer, who has been on the job for 48 hours, tells the crowd he's honored and a little nervous to be in charge of the world's biggest brokerage. Then he breaks into a story about a phone call from David Komansky, the former broker who ran Merrill from 1997 to 2002.
"David Komansky called me up and he said, 'I can't believe a Goldman guy is going to be in my office,"' says Thain, 52, adopting a low, gruff Bronx accent to mimic his 68-year-old predecessor. He pauses for the laughter and applause to die down. "Well, I'm not a Goldman guy anymore," he says.
He certainly isn't. While Thain's old employer, Goldman Sachs Group Inc., has emerged from the subprime crisis relatively unscathed, his new firm, Merrill Lynch, had to take a $7.9 billion writedown on its mortgage-backed assets, one that cost Thain's predecessor, Stan O'Neal, his job.
The 6-foot (1.8-meter) Thain, who learned risk management at Goldman and consensus building as CEO of the New York Stock Exchange, will need all of his skills to repair 94-year-old Merrill.
Thain is moving swiftly to restore order. On Monday, Dec. 3, the new boss chaired an all-day board meeting. That day, he also handed Nelson Chai, his chief financial officer from NYSE Euronext, the same job at Merrill.
Like many people who know Thain, Chai praises the newcomer's high- wattage intelligence: Thain holds a degree in electrical engineering from Massachusetts Institute of Technology and a Master of Business Administration from Harvard Business School.
http://www.bloomberg.com/news/marketsmag/mm_0208_story1.html