UPDATE: After days of withering criticism over the Merrill deal and the losses at the company, Bank of America top brass met this morning about John Thain’s fate at the company. Thain is out. Ken Lewis should be next.
Here’s how Lewis tries to pass the buck in the WSJ:
Bank of America had lost confidence in Mr. Thain, this person said, after Mr. Lewis learned of mounting fourth-quarter losses at Merrill from the transition team handling the Bank of America-Merrill merger rather than from Mr. Thain himself. And when Mr. Lewis asked Mr. Thain what happened, the Bank of America CEO did not get a “good explanation for what was happening and why,” this person said.
The Bank of America CEO also concluded Mr. Thain has exercised “poor judgment” on a number of fronts. He left for a vacation in Vail, Colo., after the losses came to light, bonus payments at Merrill were accelerated so they could be collected before the end of the year and Mr. Thain had planned to fly this week to Davos, Switzerland, even though Bank of America had signaled that such a trip was not a good idea, this person said.
EARLIER: We’ve heard separately that both Thain and head of sales Tom Montag could be out by tomorrow, so the report jibes with what we’ve learned.
And really, even if there were any desire to keep Thain around, you have to imagine that by this point the air there is quite poisonou. Why would he want to stay?
Here’s Charlie Gasparino’s report from CNBC:
BANK OF AMERICA, KEN LEWIS WILL HOLD AN EMERGENCY MEETING WITH JOHN THAIN, THE CEO OF MERRILL LYNCH TODAY. THIS COMES AFTER THAT MASSIVE LOSS THEY ANNOUNCED LAST WEEK. FROM WHAT I UNDERSTAND, THIS WILL centre ON THAIN’S FUTURE WITH THE FIRM, WHETHER HE STAYS OR GOES.
SOURCES ARE TELLING ME THAT HIS FUTURE IS UNCERTAIN AND THIS MEETING APPARENTLY WILL OCCUR AROUND 11:30 THIS MORNING. AND AFTER THE MEETING, WE ARE ESSENTIALLY GOING TO FIND OUT WHETHER JOHN THAIN STAYS OR GOES AT MERRILL LYNCH. THE RELATIONSHIP, LET’S SAY, HAS BEEN VERY, VERY, VERY STRAINED OVER THE LAST COUPLE OF WEEKS WITH THE DEPARTURES OF BOB FLEMING, HIGH RANKING EXECUTIVES BLAMED THEIR DEPARTURES ON JOHN THAIN RATHER THAN THIS MERGER WITH BANK OF AMERICA. THEY KIND OF LIKED THE B OF A PEOPLE.BUT SINCE THEN THERE’S BEEN THIS SURPRISE LOSS, 10, $15 BILLION AT MERRILL MOST THE MERGER WITH BANK OF AMERICA.
LEWIS HAD TO GO BACK TO THE FEDERAL GOVERNMENT, GET MORE MONEY TO MAKE THE MERGER WORK. HE FELT EMBARRASSED. SINCE THEN THE RELATIONSHIP GOT VERY STRANGE — STRAINED — MAYBE STRANGE, TOO — BUT WHAT CNBC HAS LEARNED THAT THIS THING IS COMING TO A HEAD THIS MORNING. KEN LEWIS WILL HOLD AN EMERGENCY MEETING WITH JOHN THAIN. I HEAR THIS IS AROUND 11:30.
FROM WHAT I UNDERSTAND IS THAIN’S FUTURE WILL BE DECIDED RIGHT THERE, WHETHER HE STAYS OR GOES, INSIDE THE FIRM. YESTERDAY A SPOKESWOMAN FROM MERRILL DENIED THAT JOHN THAIN WAS LEAVING THE COMPANY.
BUT INSIDE THE FIRM, MY SOURCES TELL ME, SENIOR EXECUTIVES IN THERE TELL ME THAT HE’S LIKELY OUT. THE SITUATION THERE HAS GOTTEN VERY BAD. SO WE’LL KNOW AFTER THIS EMERGENCY MEETING. IT’S AT 11:30. THE SOURCES INSIDE MERRILL SAY THAT THE CHANCES ARE HE’S GONE, MEANING JOHN THAIN IS GONE.
WE’LL KNOW THEN, BUT THERE IS DEFINITELY A MEETING. THIS MEETING IS TO DECIDE HIS FATE. GUYS, BACK TO YOU.