Merrill Lynch Chief Fighting For Bigger 2008 Bonus

Update 4:40pm EST:

Morgan Stanley's CEO John Mack has announced that he will not be getting a bonus for the second year in a row:

Morgan Stanley CEO John J. Mack is giving up a bonus for the second straight year amid a climate of bank failures, thousands of layoffs and an economic recession.

Mack said in a memo Monday to employees obtained by The Associated Press that he and the firm's two presidents, James Gorman and Walid Chammah, informed their board's compensation committee of their decision to forgo 2008 bonuses, and the committee accepted.

Update 3 pm

Senate Majority Leader Harry Reid has released a statement regarding Thain's "chutzpah" in asking for the money.

via The Hill

"The TARP program, from which Merrill Lynch has taken billions of taxpayer dollars, was designed explicitly to limit executive compensation, bonuses and golden parachutes. While American families struggle to keep their jobs and their homes, I question the chutzpah of asking for a $10 million taxpayer-subsidized bonus. Americans deciding which bills to pay this month just to make ends meet do not want their hard-earned money even indirectly spent rewarding executives from banks that are largely responsible for the economic crisis. I sincerely hope that Merrill Lynch rejects this request."

***

From the Wall Street Journal:

Merrill Lynch & Co. chief John Thain has suggested to directors that he get a 2008 bonus of as much as $10 million, but the battered securities firm's compensation committee is resisting his request, according to people familiar with the situation.

The committee and full board are scheduled to meet Monday to hear Mr. Thain's formal bonus recommendations for himself and other senior executives of the New York company. No decision has been reached, and it isn't known what Mr. Thain will recommend, but the compensation committee is leaning toward denying the executives bonuses for this year, these people said.

Reuters points out that several other Wall Street firms, including Goldman Sachs, will not be giving out bonuses to top executives this year. Though Thain's company was sold to Bank of America after losing a net $11.67 billion this year, Thain argued that it could have been worse.

From the Reuters story:

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.

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

Comments

[jalowe1957]

Talk about an absence of humility and empathy for others.

[sandpiper1]

Now there is someone who should be in prison, charged with audacity and greed. He's no better than Blagojevich. The man is oblivious to the damage he and his cronies have done.

[DonCosenza]

How else do you expect Thain to continue to afford his daily regimen of live human baby spinal fluid, necessary to maintain his super-human powers?

[ibezoo]

Can his ass for even asking.

[Ravyn]

People like Thain should be penalized and made to give back their bonuses from previous years to their employees and customers who got screwed by their greed and mismanagement of their companies. It's an absolute disgrace that men like him continue to act like "Masters of the Universe" when so many investors, especially retirees, lost chunks of their investments and the entire US and world economy is in the toilet. Thain and those other greedy unethical bastards like him should be loosing most of their assets, fired, and run out of town or, preferably, the U.S.

[mtflyer]

If these criminal organizations had a shred of decency, they would not only refuse bonuses but fire the incompetents with no severance-nothing! they really deserve to be in a place like Guantanamo.

[rsk825]

I question the staggering "rush" to get bailout money. Then the fact that one week later, it was not being used to help troubled mortgages. Instead it is being used to line the pockets of investors. It came from NOWHERE with such powerful urgency, under the agenda of helping homebuyers, and has changed already. Seems hauntingly similar to the invasion of Iraq..." What began as "Shock and Awe" with rapid urgency based on WMD's, then progressed to "Operation Iraqi Freedom".T­he Republicans seem to be able to use this strategic method of striking fear into us, and the house, out of nowhere, and get things passed at the taxpayers, and U.S. citizens based on our fears. They have been effective with this strategy in getting what they want. I wonder how inflated this entire situation may be. I can't trust them whatsoever!

[demigod]

My Merrill Lynch account lost so much money this year I'd jump out a window if I took it seriously - the losses are just stupifying, and this CLOWN thinks he's done anything to merit a BONUS ? This guy makes Marie Antoinette look bush league. Time for the guillotine - off with his head, Citizens !

[whatfreshhellisthis]

Bush league! Yep, many of these greedy robber barons appear to be in the same league as Geo W. Bush----caring only for themselves, and oblivious to all others.

[SharonWantsToTalk]

I have no reference upon which to draw when I see this kind of thinking. I do not know nor have I ever met someone that is like this man. He and his cohorts seem alien. How can we stop their ideology from continuing in our institutions? I understand greed. That will always be a constant. But where do they grow this kind of monster?

[Smirk]

They may not grow them, but College Republicans nourish and encourage them.

[Teritt]

I hope everyone that lost their job and is trying to decide where to rollover their 401k reads this article. Compare fees, and ask yourself just how much of your money will go to these overpaid CEOs.

[sanminiato]

So Thain thinks he deserves a big bonus by selling to B of A. It must have been very tough work.

[tklink]

He's a pig. The audacity to watch the world economic system melt, know that you had a part in it, and request an enormous bonus...? He is repulsive. Those involved in the housing & financial industries, particularly over the past 9 years, should have to payback a pro-rated amount of their ridiculous salaries and bonuses and create an account of sort to at the very least assist the hard-working families who have been affected by this cluster*#!*.

[irishguyjay]

The sense of entitlement these people have is just astounding. No shame at all...

[Oxonian2001]

This man still has a $750,000 salary--amongst other things. He has 3 kids--not 10. How much more could he possibly want? I suppose the kids and wifey will have to forego the multiple trips abroad and maybe that extra castle, chalet or whatever.

He's lucky he even has a salary.

[DonCosenza]

Are you kidding? With the coming deflationary cycle, he'll need all that extra cash to buy your house and enslave your family.

[zanzig]

The UK papers are reporting that Thain changed his mind and decided not to request a bonus, but is apparently very disgruntled by it all as he still believes he deserved the $5-10 m.

[DonCosenza]

I think what he deserves are a few raw Extra Large eggs to go with his crisp attire.

[chagedorn]

Gee, "not taking" money you've neither earned or deserve. Our CEO's are really lining up for the Noble Businessman of the Year Award which, like their jobs, appears to be based solely on who you know rather than what you know, and making sure that people you know are all on your Board of Directors.

[kolorkin]

He should look at who's been bailing out the banks and auto-industry and whether some of them still has a job.

he's in way over his head.