John Thain used his first day as chief executive of Merrill Lynch to appoint Nelson Chai, his chief financial officer at NYSE Euronext, as executive vice-president and chief financial officer at Merrill Lynch.
Monday’s move, which had been expected, marks a stellar ascent for Mr Chai, 42, who became chief financial officer of the New York Stock Exchange following the reverse takeover of Archipelago and the NYSE in 2005, taking the Big Board public in the process. The affable Mr Chai, who is known for his good sense of humour and laidback demeanour, succeeds Jeff Edwards, who has been Merrill’s chief financial officer since 2005.
Mr Chai had been chief financial officer at Archipelago since 2000 but has never worked at an investment bank and has limited experience of risk management, which comprised part of Mr Edwards’ role.
In recent times, the risk management procedures at the company have been heavily criticised.
Mr Edwards, previously head of investment banking for the Americas, is expected to assume a new operating role at the company in due course.
Mr Thain has indicated that risk management at Merrill is “obviously” in need of being addressed.
He told the Financial Times last week that he also plans to revamp the senior management culture at Merrill Lynch in part as an effort to emulate Goldman Sachs, one of Merrill’s chief competitors and Mr Thain’s former employer.
He said that he believed there was insufficient co-operation between senior Merrill executives, a problem that could have contributed to the bank’s disastrous $8bn (£3.9bn) mortgage-related writedown. He said on Monday he was confident that Mr Chai could repeat his success at the NYSE at Merrill.
In an interview with the Financial Times on Monday, Mr Chai said he accepted that the timing of his and Mr Thain’s departure from the NYSE could have been better with respect to the integration of Euronext and the NYSE, admitting it would have been nice to have more time, but that he was confident the team he had put in place was well positioned to see the job through.
NYSE Euronext has appointed Joost van der Does de Willebois, deputy chief financial officer and head of the company’s Amsterdam market, as acting chief financial officer under new chief executive Duncan Niederauer.
Analysts said the move was a nod to continue to stress the equality of both sides in the newly created transatlantic exchange. Mr Chai received a bachelor’s degree from the University of Pennsylvania and an MBA from Harvard Business School.
He is a board member of the US Fund for Unicef, the US-India Business Council and the National Stock Exchange of India.
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