It's got stiff competition, but Merrill Lynch may have just wrapped up the prize for the investment bank that best exemplifies Gordon Gekko's famed articulation of the Wall Street creed: "Greed is good."
The Financial Times reports(sub. req.) today that in early December, Merrill, which months earlier had agreed to be bought -- rescued, really -- by Bank of America, decided to pay out $3-4 billions in bonuses.
The bonuses were handed out on an accelerated schedule -- at least a month earlier than in previous years. And they ere agreed to just days before Bank of America, realizing how much in toxic assets Merrill had on its books, went to the federal government asking for more taxpayer money to help it digest Merrill -- money that was eventually forthcoming.
One equity analyst told MarketWatch that the move, apparently initiated by then-Merrill CEO John Thain, was "simply outrageous and one of the more extreme examples of poor corporate governance we can think of."
You also might remember that Thain -- who today resigned as a Bank of America exec, amid criticism -- had originally asked the firm's compensation committee for a $10 million bonus for himself, as part of that round of payouts, though the committee at least had the good sense to decline the request.
And the Wall Street Journal now reports that New York Attorney General Andrew Cuomo is investigating the payouts -- part of a broader probe of executive compensation among Wall Street firms.
Just to get a clear sense of how this all went down, and what a boondoggle this looks to have been for Merrill, it's worth looking at a timeline of events:
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