MarketWatch reports that tensions are already apparent between staff at Bank of America and Merrill Lynch, as the two firms merge.
Merrill brokers are said to have been 'chafing' at BofA brokers, who sell stocks through a retail network, and are thought to have mocked the 'spirit points' reward system that Bank of America uses to reward its staff.
Here Is The City is also hearing that Bank of America staff have become increasing miffed about what they regard as Merrill staff's 'star status', whilst Merrill insiders say that working for BofA looks like being a bureaucratic nightmare, as everything seems to require triple-sign-off. Merrill staffers say that Bank of America's bureaucracy only seems to have two speeds - 'dead slow' and 'stop'! And those canny Merrill Lynchers are already thought to be trying to work out how to get round the 'system'.
In the meantime, stockholders at both firms approved the merger Friday. Due to the fall-off in stock prices in the last 3 months, the all-share Merrill Lynch acquisition finally went through valued at $19.7bn. And every current Merrill board member, except CEO John Thain, skipped the final shareholder meeting in the firm's 94-year history. Winthrop Smith, whose father was a co-founder of modern Merrill, told shareholders: 'Today is not the result of the subprime mess. This is the story of failed leadership, and the failure of the board of directors to understand what was happening to this great company, and its failure to take action soon enough'.
And as Bank of America CEO Ken Lewis has already indicated, the Merrill deal might just be his last. And it will also probably be his toughest to make work. Bloomberg quotes ex-Merrill Lyncher James Ellman, now president at SeaCliff Capital, who said: 'There are some hand grenades on the (Merrill) balance sheet that are going to blow up on Bank of America. The cost savings are (also) going to be nowhere near what they have already promised'.
Working hard to try and ensure that the deal does work, however, will be Thain. If he gets his part of the empire working (the investment bank, brokerage unit and asset and wealth management units), he will most likely follow Lewis as CEO when Lewis decided to pack it in (or just remain as Chairman).
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