Bank of America Corp. confirmed Thursday former Merrill Lynch & Co. Chief Executive John Thain is resigning from the company and named Brian Moynihan as his replacement.
The shakeup came three months after Bank of America said Thain would oversee its global banking, securities and wealth management operations while Moynihan would take on a newly created position after the acquisition that would look at redefining the company's business model. Moynihan also became general counsel.
Additionally, the financial services company said Tom Montag will continue to run its global markets segment and become a member of the management executive team, which helps set the company's strategy. He will report directly to Chairman and Chief Executive Ken Lewis while overseeing sales, trading and research.
Moynihan was named president of global banking and global wealth investment management, a role similar to the one he held with Bank of America before it added Merrill to its operations.
Bank of America had lost confidence in 53-year-old Thain, a person familiar with the matter told The Wall Street Journal, as Lewis learned last month of mounting fourth-quarter losses at Merrill from the transition team handling the merger, not Thain himself.
Lewis said Thursday the changes would continue to positively serve their clients and said the changes didn't reflect a significant change in direction for the global banks or wealth management units.
Moynihan, 49, first joined Bank of America in 2004 following the company's purchase of FleetBoston Financial. Moynihan first joined Fleet Financial Group in 1993 as deputy general counsel.
Montag, 52, joined Merrill Lynch as executive vice president and head of global sales and trading last summer to turn around Merrill's sales and trading operation. He had spent 22 years at Goldman Sachs Group Inc. (GS), becoming a star trader there.
Bank of America shares were down 12% at $5.92 in recent trading, though the stock was down as much as 18% before rebounding around noon. The stock has been pummeled this month, in part on the Merrill woes, and is down 58% in January after falling two-thirds last year.