Allison Kilkenny: Unreported

Balls of Steel: Merrill Lynch CEO Asks For $10 Million Bonus

Posted in corporations by allisonkilkenny on December 8, 2008

TheStreet.com

"I'd like more money, please."

"I'd like more money, please."

Merrill Lynch CEO John Thain suggested to directors that he get a 2008 bonus of as much as $10 million, but the securities firm’s compensation committee is resisting his request, the Wall Street Journal reports, citing people familiar with the situation.

The committee and full board are scheduled to meet Monday to hear Thain’s formal bonus recommendations for himself and other senior executives of the New York company. The compensation committee is leaning toward denying the executives bonuses for this year, the Journal reports.

Shareholders of Merrill Lynch on Friday approved the securities firm’s acquisition by Bank of America to create the nation’s largest financial services company.

Thain argues he was instrumental in averting what could have been a larger crisis at the firm by contacting Bank of America about a tie-up, the same day Lehman Brothers filed for bankruptcy, the newspaper reports.

Members of Merrill’s compensation committee agree with Thain that the takeover was in shareholders’ best interest, but are weighing the fact that other Wall Street firms, such as Goldman Sachs, aren’t giving out bonuses to top executives, the Journal reports.

Once the merger of Bank of America and Merrill is completed, Thain will be in charge of the combined company’s global banking, securities and wealth management businesses. He won’t join the board of Bank of America.

Huffington Post

Reuters points out that several other Wall Street firms –including Goldman Sachs, which did better than Merrill this year– will not be giving out bonuses to top executives this year. Though Thain’s company was sold to Bank of America this year, Thain argued that it could have been worse.

Thain has said he deserves a bonus because he helped avert what could have been a much larger crisis at the firm, people familiar with his thinking told the WSJ.
Members of Merrill’s compensation committee agree with Thain that the takeover is in shareholders’ best interest, but believe it would be foolish to ignore strong public sentiment against large compensation packages, the paper said, citing people familiar with their thinking.

 
Thane will stay with the company following the merger, Bank of America has said. Thane, for his part, has predicted that “thousands” of other Merrill jobs will be lost in the wake of the merger.

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