More than a day after the WSJ and NYT declared in no uncertain terms that he was out, Merrill Lynch CEO Stan O’Neal finally “retired” this morning. I was starting to wonder if O’Neal might be staging some sort of rearguard save-my-job action, but I guess it just took time to negotiate a cushy enough exit package.
That should return Citi’s Chuck Prince to the position of most endangered CEO of a major U.S. financial company. After him, it looks like James Cayne of Bear Stearns has survived his summer troubles and will be allowed to retire gracefully in a year or two (he’s already 73)–unless of course Bear gets itself into more trouble. Then there’s Angelo Mozilo at mortgage giant Countrywide Financial, which reported last week that it lost $1.2 billion in the third quarter. He’s the founder, which is probably the main reason he’s still in charge. But if his latest promise that Countrywide is just about to turn the corner and start making money again doesn’t pan out, maybe the company’s board will finally lose patience. Don’t count on that, though.
Update: Former Merrill banker Abigail Hoffman argues in the FT that Stan didn’t deserve to go:
[I]n the end it was his enemies, not his errors, that brought Mr O’Neal down. He cut costs and staff rigorously following the September 2001 downturn in the industry, which won him no popularity.
Mr O’Neal changed Merrill and, in my opinion, he changed it for the better. He diversified the business away from its traditional retail broking focus and oversaw significant profit growth. Net earnings rose 47 per cent last year to a record $7.5bn.