Bloomberg News

TOKYO — Merrill Lynch & Co. said about a fifth of the 1,850 staff members that came to it from the failed Yamaichi Securities Co. in Japan more than two years ago have left, even though Merrill has been outpacing its rivals in new hires.

Merrill Lynch Japan Securities Co., which has the largest retail network in Japan among foreign brokerages, has lost about 400 former Yamaichi employees, said spokesman Hideki Sakuma.

“For various reasons, [Yamaichi] people who are not happy with Merrill’s business style have left our company,” said Mr. Sakuma, who himself came from Yamaichi. “Yet many bankers who like Merrill’s corporate culture have joined us.”

Merrill took over Yamaichi’s 33 branches and about 1,850 employees in July 1998 after Japan’s fourth-largest brokerage shut down after news emerged that it had sustained losses of as much $2.2 billion.

Merrill was at the front of a number of U.S. financial services companies that have set up shop in Japan in recent years to capitalize on the deregulation of that country’s securities markets.

Since the purchase, Yamaichi’s share of Merrill’s staff has fallen from 95% to 67% in February. In the same period the company hired 600 bankers from other Japanese firms.

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