On Monday, Bob McCann, a popular Merrill veteran who led the firm’s 16,850-person “thundering herd” of brokers, resigned. Advisors we spoke to were not surprised that he left—only at the timing of the announcement. According to some Merrill reps, McCann was said to have clashed with Merrill CEO John Thain.
Thain, nevertheless, put a smooth spin on McCann’s planned exit, citing his “distinguished” 26-year career, significant contributions and strong leadership “in the face of extraordinary challenges.”
Still, even though some Merrill pros were “nonplussed,” it did send a chill through the ranks of others—especially some of Merrill’s proud and independent-minded brokers. It also left Merrill with some questions to answer.
A Merrill veteran—who once worked as a manager for McCann in New York when McCann ran Merrill’s sprawling institutional stock trading operations—said many staffers were in shock at the timing of his departure: “Many of us felt it was inevitable that Bob would eventually leave—his professional conflicts with John Thain were well-known. But I think they are surprised it happened so soon.”
The anonymous Merrill vet also said that the shock was compounded by Merrill’s failure to clarify how McCann’s exit will impact the transition at this critical stage. “The firm will be going through an unbelievable change as this acquisition plays out, and it seems a little odd Bob would leave this early, when there are still a lot of questions to be answered. Bob would have played a vital role in the months ahead in helping to ensure a smooth transition.”
The questions range from the mundane to the critical, regarding everything from backoffice operations and technology integration to retaining the loyalty of a Merrill brokerage force still reeling from attrition. There are also queries related to the anger over retention packages in the wake of Bank of America’s decision to acquire Merrill. Merrill agreed to be acquired in September, following more than $50 billion in losses from the destruction in the U.S. sub-prime market.
The 50-year-old McCann was seen as an important leader in the success of the Bank of America/Merrill transition in the coming months, especially in melding two disparate cultures. Merrill brokers were seen as more aggressive and hard-charging asset gatherers compared with Bank of America’s more restrained reps.
“Bob was the best boss anyone could have; his honesty stood out the most. You got a straight answer to your questions even if it was not the kind of answer you’d prefer,” said the Merrill vet.
But this vet also praised McCann’s managerial talents—his personal, down-home ways and “gift” for connecting with employees from entry-level mailroom clerks to senior managers. He was there for staffers on all occasions, from family sadness to birthday bashes. “He never forgets his staff,” this vet said.
But Thain was not so impressed. For example, as Thain stood before nervous employees after the BoA announcement, Thain publicly berated McCann for leaking a story to a newspaper about McCann’s place in the combined entities. Thain would not allow a visibly upset McCann take the microphone.
Under the plans, McCann had his sails trimmed by Bank of America which said a higher-ranking “global wealth and investment management” post would be filled by some other executive to be named. At Merrill, McCann had been vice-chairman and president of global wealth management.
Said the Merrill insider: “They wanted Bob to pursue more of a strategic role working with financial advisors—and whatever role that exactly was, it was de minimis compared to the role he had earlier.”
McCann's unexpected departure was announced via an internal memo from Thain, who quoted McCann: “Bob told me: ‘After much reflection and deliberation, I have decided that this is the right time for me to move on. This was not an easy decision; my time at Merrill Lynch has enriched my life both professionally and personally. I’m proud to have been part of such a great company, and I feel fortunate to move forward with treasured friends and memories.’”
The Merrill vet said he thought it unlikely that the highly accomplished McCann has a new job lined up. “I have been shocked by events on the Street these past 14 months—and that would really shock me,” he said.
Selena Morris, a spokeswoman for Bob McCann, did not return calls for comment.