Former Merrill Lynch CEO Dave Komansky dead at 82
There was a time when it didn’t matter what school you went to or whether you had a fancy MBA. If you were smart and hungry, you could have a career on Wall S♏treet — an🐽d even run a big firm.
Dave Komansky, the former🔴 longtime CEO of Merrill Lynch, who epitomized that largely forgotten parဣt Wall Street, died Monday of natural causes. He was 82.
What I’ll always remember about Dave: his thick Bronx accent and how he could relate to anyone — something that can’t be taught at business school. Clients loved him, people liked working for him. And Dave never finished college♍ because he didn’t need to.
He knew how Wall Street worked and he could translate that knowledge to help people invest as one of the best brokers in the Merrill Lynch system. He carried that persona from the small office in Queens where he got his start as a broker trainee through to the Merrill executive suites, eventually becoming CEO in 199🎐6.
Amid all𒁃 this success, Komansky never forgot his roots, or the firm’s founding principles. Under Komansky, Merrill would become a large, diversified investment bank. But it continued to be defined by its “Thundering Herd” of financial advisers — a fꩲirm largely focused on dispensing market advice to small investors from brokerage offices in large cities and small towns across America.
Merrill would also remain defined by another one of its traditions, something that dates back to days of Charlie Merrill. It’s the concept known as “Mother Merrill” — a brokerage firm that actually cared about its people.
While other CEOs seemed to luxuriate in mass layoffs (and the surging stock price that often followed) Merrill under Komansky considered downsizing a last resort. In 1998, when bank mergers were all the rage, Dave refused to sell Merrill to JP Morgan because he couldn’t stomach seeing what he called the “elevator people” getting fired as they smashed the two large firms together.
These were the averagꦬe men and women who Dave saw regularly in the elevator — and who Dave considered f𓆉amily.
“Dave knew t✱he first names of top executives, brokers and janitors,” said his longtime friend Dick Grasso, the former head of the New York Stock Exchange. “He cared about h🦄is family first, but his family wasn’t just blood relatives; it was also his family at Merrill Lynch.”
Dave worked at Merrill for 35 years. It never shocked me that just a few years after he ꦫleft as CEO in 2003 following a nasꦆty boardroom coup d’état, the firm imploded. In hind🙈sight, the reason was obvious: It started to value risk and profits over the people Komansky took the elevator with.
Of course, Dave had his blind spots (as we all do). Toward the end of his tenure as CEO, he trusted the wrong people. His attention to detail had waned (friend🌠s would say because of a chronic back problem). Profits at Merrill fell behind those at firms like Goldman Sachs.
New management came in and focused on being more like Goldman as opposed to embracing Charlie Merrill’s vision of “bringing Wall Street to Main Streꦫet.”
Merrill enjoyed a few years of souped-up trading profits as it embraced Goldmanesque trading risk until it became clear that risk also has its downsides. Like most of Wall Street, Merrill was on the verge of extinction in 2008 during the throes of the financial crisis. It was saved because of a government bai💛lout and because Bank of America couldn’t wait to get its hands on the brokerage crꦓown jewel.
Today, the risk-taking part of Merrill is gone, but its “Thundering Herd” of ꦜbrokers continues to thrive.
Again, Dave had his blind spots, but no one could ever question his honesty, integrity, his respect for clients and love of Merrill, particularly those “elevator people” who have made the Thundering Herd one of Wall Street’s great firms.
RIP.
