Merrill's Thain Backs Off $10M Request

Updated from Monday, Dec. 8

Merrill Lynch (MER) Chairman and CEO John Thain and other top company executives requested on Monday that they receive no bonus, as Thain backed off an earlier reported request for as much as $10 million.

Thain, President and COO Greg Fleming, CFO Nelson Chai, President of Global Wealth Management Robert McCann and General Counsel Rosemary Berkery all requested they not receive a bonus from the brokerage, whose shareholders last week approved a deal to sell the firm to Bank of America (BAC).

"Mr. Thain and the other executive officers believe this is the appropriate recommendation to the board for the Merrill Lynch shareholders and Merrill Lynch employees given current economic and market conditions," the company said in a statement late Monday.

Thain's $10 million bonus request, reported earlier Monday by The Wall Street Journal, had some Wall Street observers confused, and others in an outright uproar.

"It would be a public relations disaster for the company," said John Challenger, CEO of Challenger, Gray & Christmas, an outplacement consulting organization. "CEO pay is under the microscope, and at this time of such intense scrutiny -- especially at banks and especially at former investment banks -- it would have created a firestorm," he said.

Challenger said that the hubbub over Thain's request reflects uncertainty about how CEOs should be compensated following upheaval in the financial-services industry.

"The old standards are being thrown out," he said.

Thain's apparent decision to abandon his bonus request comes as other top Wall Street executives have decided to forego outsized compensation this year. Top executives at Goldman Sachs (GS) won't be getting any year-end prizes, and reports indicated Monday that Morgan Stanley (MS) CEO John Mack is likewise doing without.