Business & Financial News

In III quarter 2007, the largest investment bank of USA Merrill Lynch has incurred the greatest for all history of the company losses. In this connection bank’s board of directors’ has made a decision on removal from a post of the main executive director and President Merrill Lynch.
However, while it is not known, who will become the head of the bank. Anyway, managers mark, that the appointment of new director will not help the bank to solve all problems.
While experts mark, that now Merrill Lynch will have to find out, whether there were last steps undertaken by bank are incorrect initially or simply badly were resulted in the implementation. Any further write-offs of actives will finally lead to decrease in balance of the company that, in turn, will again cause falling of the American giant’s shares.
It is necessary to note, that for the expired period Merrill’s shares have fallen on 30 %. For comparison, index Amex Securities Broker/Dealer Index ($XBD), representing the broker companies, has decreased on 3,6 %. And last week representatives of bank have informed that its balance cost makes nearby 39,75 doll./share and it is the lowest parameter since II quarter 2006.
But, in some analysts’ opinion in the nearest future the company will have to solve a number of the important strategic questions. Now the bank has begun aggressive expansion to sector of risky investments. And now it will be necessary for successor of the former president to analyze, whether Merrill Lynch’s losses are connected with incorrectly chosen strategy or with its incorrect realization.