Former Merrill boss Thain ousted from Bank of America amid losses

23 January 2009

The former chief executive of Merril Lynch and Co, John Thain, has found himself ousted from Bank of America Corp after the surprise discovery of losses at the brokerage that was acquired by the bank less than a month ago. The losses created a crisis of credibility, reports said.

Bank of America CEO Kenneth Lewis had expressed his dismay over the scope of losses from motrgage and toxic debt on Merrill's books, after which analysts and investors were reported as saying that Thain's position as head of global banking, securities and wealth management was becoming increasingly unsecure.

Bank of America spokesman Robert Stickler said that Lewis flew to New York and met Thain, after which it was mutually agreed that he would resign with immediate effect.

Thain could not be reached for comment, and Merrill was unavailable for comment. Bank of America said the terms of Thain's departure would be disclosed later.

Reports said that Thain's exit was announced just a day after he bought around 84,600 Bank of America shares valued at around $483,320 which shored up his direct stake in the bank to around to 549,700 shares. The purchase had been disclosed in a US Securities and Exchange Commission (SEC) filing, reports said.

Thain's position will be filled by Brian Moynihan, the 49-year old general counsel of Bank of America and a former investment banking chief; however, global markets chief Tom Montag will report directly to CEO Lewis and will aid in chartering the bank's strategy.