Mumbai: Merrill Lynch & Co Inc, which took an $8.4 billion third quarter write-down on its mortgage-backed assets, is likely to renew its headquarters lease in Manhattan's World Financial Center, the Wall Street Journal reported.
Merril has not signed the five-year renewal lease with Brookfield Properties Corp, landlord of the World Financial Center complex, and the deal could still fall apart, the report added.
John Thain, the company's new chief executive, who was risk management head at rival Goldman Sachs, may also find it an uphill task to repair 94-year-old Merrill.
While Goldman Sachs Group Inc. emerged from the sub prime crisis relatively unscathed, Merrill Lynch had to take a huge write-down on its mortgage-backed assets. The loss also cost Thain's predecessor, Stan O'Neal, his job. (See: Stan O''Neal Merrill Lynch''s beleaguered CEO to go)
O'Neal, 56, had already cut more than 18,000 jobs and closed 250 Merrill Lynch offices when the market faltered in 2001 and 2002.
Thain, who became the new chief executive last month, is moving swiftly to restore order. He plans to create an executive committee of business heads whose members will report directly to him. Prominent on the committee will be a chief risk officer leading a reorganised unit.
Thain is also shaking up Merrill's trading division with a move to appoint a fellow former banker to run its markets division. The CEO is also hiring senior traders, whose ranks are thin, he said.
In fact, Merrill Lynch has been in talks to hire Thomas Montag, the former co-head of global securities at Goldman Sachs, a Bloomberg report said.
Merrill last month also announced a cash infusion of around $6.2 billion from Singapore's Temasek Holdings Pte Ltd. and New York-based Davis Selected Advisors L.P.
Thain, Merrill Lynch's first CEO from outside the company, is expected to keep close track of the new risk-management system to avoid a repetition of the subprime-mortgage debacle.