O'Neal Ouster Makes Mess of Maternal Merrill Lynch

Losing a lot of money for shareholders is the surest way to end a career on Wall Street, as Merrill Lynch & Co.'s Stan O'Neal found out this month after the embattled chief executive officer delivered the worst news in the firm's 93-year history.

The third-quarter loss of $2.24 billion, or $2.82 a share, was about six times more than O'Neal acknowledged on Oct. 5 and derived from $8.4 billion of writedowns for the subprime mortgages, asset-backed bonds and loans gone bad under his watch.

Merrill's result, coming during a credit market shakeout that triggered a run on a British bank and caused Switzerland's largest financial institution to fire its CEO, was the biggest quarterly debacle in the history of the securities industry. That was enough for the 11-person board, nine of whom were handpicked by O'Neal during his five years as CEO, to make it clear the 56- year-old grandson of a former slave is leaving, possibly as early as today, according to a person with knowledge of the directors' discussions.

For Merrill, a firm that over nine decades built a corporate culture that promoted from within and gently nudged its chiefs into distinguished retirement, O'Neal's ouster is an abrupt departure. To his predecessors, many of whom resented his penchant for getting rid of dozens of Merrill loyalists, the losses are a painful reminder of how much has changed at the brokerage they used to call ``Mother Merrill.''

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