John Thain, who was CEO of Merrill Lynch for the past year, resigned from Bank of America today. Thain had engineered Merrill's acquisition by Bank of America last September. Both Bank of America and Merrill have received billions of bailout money from the taxpayers. A few highlights of Thain's management decisions at Merrill can be found here and here:
"Serious bad blood appears to exist between B of A's CEO Ken Lewis and Thain, with Lewis feeling like Thain was not up front about the problems at Merrill Lynch when the deal was announced back in September," said Jaime Peters, an equity analyst at Morningstar.
Peters also noted that Thain decided to accelerate bonus payments at Merrill, giving out somewhere between $3 billion and $4 billion to employees before the Bank of America deal closed.
"Considering the company's large fourth-quarter loss and the $20 billion of capital B of A got from the government in order to prop up its balance sheet following the deal, this is simply outrageous and one of the more extreme examples of poor corporate governance we can think of," Peters said.
While we mere mortals are sucking the fuzzy end of the lollipop, the wall streeters are earning 3 to 4 billion in early bonuses ---- bonuses that are not normally paid until January or February.
Thain spent $1.2 million to redecorate his office at New York-based Merrill, CNBC reported today.
Ah yes, we can't let this poor guy have an undecorative office, can we? Why not give Bank of America/Merrill another $50 billion to make sure all executive offices are tastefully decorated?