Merrill Lynch & Co Inc Co-President Greg Fleming told employees on Monday he has tremendous confidence in the company's long-term prospects and said the company's strategy is fundamentally sound.
While the markets continue to be volatile, and challenges remain ahead, I have tremendous confidence in our long-term prospects, Fleming told employees in a letter obtained by Reuters. Our core businesses continue to perform well, our strategy is fundamentally sound and our incomparable global footprint and capabilities position us to take advantage of market opportunities around the world.
Fleming's letter, titled A new chapter at Merrill Lynch, comes after several weeks of turmoil at the world's largest brokerage. Chief Executive Stan O'Neal lost his job late last month after the company recorded the biggest quarterly loss in its history. Merrill shares are down 43 percent this year as investors worry the company will further write down, or reduce, the value of assets underpinned by subprime mortgages.
Fleming thanked employees for their loyalty during the tumult.
Next week, Merrill gets a new leader in John Thain, a Goldman Sachs Group Inc (GS.N: Quote, Profile, Research) veteran who most recently has been chairman and chief executive officer of NYSE Euronext (NYX.N: Quote, Profile, Research).
After spending time with Thain over the past 10 days, Fleming said he is impressed with Thain's insight into Merrill's culture, brand and employees.
He is a seasoned and decisive leader with deep knowledge of our industry who has tremendous respect and admiration for our franchise, Fleming said in the letter.
Fleming also told employees he was pleased that the Wall Street Journal on Monday had published a correction from a November 2 front-page story that said Merrill had engaged in off-balance-sheet deals with hedge funds to delay losses on mortgage-related exposure.
The Journal's correction said the story was based on incorrect information.
The Wall Street Journal simply should never have written the story that it did, which is why it agreed to issue a rare correction of a page-one story, Fleming said. The control groups worked just as they are supposed to work here, and the Journal got it wrong when it suggested that Merrill Lynch had engaged in any improper transactions.