Company Overview
Highlights
One of the largest U.S. securities firms.
With senior executives originating from the lowest brokerage ranks, Merrill exhibits less white-shoe attitude than other firms do.
In the fall, Merrill recruits at colleges nationwide, but does the bulk of full-time hiring through its summer program participants.
Merrill is a huge and well-diversified financial services institution that prides itself on strong financial performance and having a leading presence in each of its core businesses. But a behemoth remains one only if it can respond to a changing marketplace. Merrill has been criticized in the past for being less than lightningquick about change, but with Stan O’Neal at the helm, this simply is no longer the case. O’Neal—who became president in July 2001, CEO in December 2002, and chairman in April 2003—doesn’t appear to waste anything, much less time.
Ranked 22nd on the 2007 Fortune 500 (up from 34th on the 2006 list), O’Neal’s Merrill Lynch is a lean, mean profit machine. According to the publication’s 2007 ranking notes, the Wall Street brokerage firm waltzed its way up 12 spots on the list with a record year in stock trades and private equity investments. Revenue is up 48 percent over last year. Profits jumped 47 percent to $7.31 billion, a company record that beats even its highs during the 1990s dotcom boom. Also helping to make it the second most profitable firm on Wall Street last year was its $10 billion acquisition of a 50-percent stake in money
manager BlackRock.
O’Neal’s campaign to rid the company of fat was no-nonsense. In the aftermath of the tech-bubble burst, he cut roughly 20,000 jobs (reports vary from 18,100 to 25,000), including a fair portion of the top executive staff. He even fired two of his onetime closest aides, reportedly for politicking behind his back.
The tough decisions and hard choices have paid off. Industry experts credit O’Neal with saving Merrill—they claim that without his aggressive and early action, the firm would not have survived as one of the few remaining independents on Wall Street.
O’Neal generated splashy headlines again in February 2006, this time for a deal to merge Merrill Lynch Investment Managers, one of the firm’s core business units, with BlackRock. He enjoyed mostly positive reviews for the move, with some observers proclaiming that he had transformed his reputation from cost-cutter to deal-maker by executing the largest transaction in the securities industry in five years. Among its perceived benefits, ther merger reduces Merrill’s exposure to stock funds, giving the firm half ownership of a money manager and thus providing an asset mix that will be more balanced between stocks and bonds.
O’Neal’s hefty pay increase in 2006—-up 30 percent from 2005 to a reported $48 million—-caught the eye of The Wall Street Journal, which declared his salary to be “the second-best on Wall Street.” People in the two remaining core business units generally say they expect the deal to be good for the firm overall. They also report that morale is high in their groups, unlike the brutal years when Wall Street wasn’t doing well.
Because of the deep cuts back then, insiders report more chances today to assume greater responsibility and advance their careers. “It’s lean now, not bloated,” one insider says. “With only a few VPs above me, I have a lot of opportunity to move up. There are a lot of mechanisms in place to keep succeeding.” “There are a lot of new groups and we’re building new platforms,” says another. “People are moving to other groups. There’s a feeling of excitement.”
Meanwhile, hiring is up industry-wide, and Merrill recruiters expect the recruiting season to be as competitive as ever. One insider says investment banking, global markets, and technology are the three hottest business areas. But don’t expect a seller’s market to compromise Merrill’s ability to hire the best and brightest. And if you’re interested in working here, be sure to know the five core Merrill principles by heart:
1. Client focus
2. Respect for the individual
3. Teamwork
4. Responsible citizenship
5. Integrity
Merrill prides itself on long-term client relationships that go well beyond the individual transaction or product of the hour.
On September 15, 2008, Merrill Lynch sold itself to banking bohemeth Bank of America for $50 billion. The deal was frantically worked out among insiders, after panic set in from Lehman Brother's simultaneous bankruptcy, and Bear Stearn bankruptcy earlier in the summer.