African-American Stanley O'Neal named top executive at Merrill Lynch stockbrokers

Wall Street's Merrill Lynch & Co., Inc., the world's largest stock broker, recently announced executive management changes in line with its continued acceleration of key strategic initiatives aimed at taking advantage of financial services reform and worldwide growth opportunities presented by e-commerce and the Internet.

Its chief financial officer, Stanley O'Neal, 48, who has served as Chief Financial Officer since 1998, will oversee its U.S. broker troops, making him a likely candidate for the top job at the No.-1 U.S. brokerage firm. O'Neal's appointment was seen by Wall Street analysts as boosting his chances of eventually replacing David Komansky, Merrill's chairman and chief executive. Komansky, 60, has not had a clear successor since Herbert Allison retired as president and chief operating officer last July. "He (O'Neal) is clearly in the running," said analyst Steve Galbraith at Sanford C. Bernstein & Co. "He's been involved in all of the important businesses."

This was part of a three-person change in top management, in which John L. Steffens becomes Chairman of U.S. Private Client Group; E. Stanley O'Neal is named as President of the U.S. Private Client Group; and Thomas H. Patrick will become Chief Financial Officer . O'Neal, 48, who already is one of the highest-ranking Black executives on Wall Street, will replace John "Launny" Steffens as president of its U.S. private client group. The group, which represents Merrill's bread-and-butter business, has about 14,200 brokers in 700 offices and $1.3 trillion in client assets. Steffens, 58, will become the private client group's chairman. O'Neal was elected an Executive Vice President in 1997 when he was named Co-Head of the Corporate and Institutional Client Group. "Stan O'Neal brings exceptional leadership skills, strategic ability and proven business acumen to U.S. Private Client," said Chief Executive Officer David H. Komansky. "He is ideally suited to lead the premier retail brokerage network in the world." "Having spent most of his career at Merrill Lynch working directly with clients, Stan O'Neal understands that the essence of our business is the client relationship, and that the role our financial consultants play is at the very heart of our success," Steffens said in a statement. In 1997, O'Neal became executive vice president and co-head of the corporate and institutional client group. He became the firm's chief financial officer a year later.

Analyst Raphael Soifer at Brown Brothers Harriman agreed, but added that the firm was in no rush to find a successor. "Komansky is a long way to 65," Soifer said, adding that Merrill's chief executives usually step down at that age. O'Neal joined Merrill in 1986 as an investment banker. Unlike Steffens and Komansky, O'Neal never worked as a stock broker. Merrill said that would not hamper O'Neal's ability to lead its broker troops. He previously was head of the capital markets group and the investor services group, which gives financial advice to institutional investors. "Stan O'Neal brings exceptional leadership skills, strategic ability and proven business acumen to U.S. Private Client," Komansky said in a statement. "He is ideally suited to lead the premier retail brokerage network in the world."

If O'Neal does succeed Komansky one day, soon, he would become only the third African-American executive to lead a major U.S. financial services firm after Franklin Raines, CEO of mortgage financing company Fannie Mae and Ken Chenault, president and chief operating officer of American Express Co. It will be a new day on Wall Street.


The Black Business Journal financial reports team, with reports from wire services.