Former Merrill CEO David Komansky dies at 82

David Komansky, a college dropout who joined Merrill Lynch & Co. as a stockbroker and expanded the firm around the globe as chairman and chief executive officer during the bull markets of the 1990s, has died. 

Komansky died Monday at 82, according to Jenn Komansky, one of his daughters. “The only thing I can say is that he was a wonderful husband and father, a wonderful friend, and everybody loved him,” she said.

As CEO from December 1996 to December 2002, Komansky added to Merrill’s network of retail brokers in Japan, Canada and Australia, making the firm’s share of revenue from non-U.S. sources higher than at any of its Wall Street competitors.

When the stock market tumbled beginning in 2000, he faced criticism for having ballooned the company’s workforce to 72,000. He watched as his designated successor, Stanley O’Neal, slashed 25,000 jobs.

In 2002, Komansky agreed to step aside earlier than planned to let O’Neal become CEO. Under O’Neal, Merrill would build a huge bet on the subprime mortgage market that ultimately led to crippling losses and the end of its run as a stand-alone firm.

The sale of Merrill to Bank of America Corp. in September 2008 “broke my heart,” Komansky said in a 2010 interview with Bloomberg Television. He said he regretted supporting the 1999 repeal of Glass-Steagall, the law that had previously kept depository banks separated from institutions involved in capital markets.

“Dave personified the classic self-made Merrill Lynch leader, rising through the ranks to become a prominent figure in the world of international finance,” Merrill Lynch Wealth Management President Andy Sieg, who was an assistant to Komansky from 1998 to 2000, said in a note to employees. “His distinctive intellect and remarkable charisma made him popular with clients, colleagues and associates of all backgrounds, from retail investors to heads of state.”

Komansky was “the epitome of the old-school financial adviser: friendly and personable, a great cheerleader for a growing company, but lacking the technical skills needed for a downturn in the financial markets and the strategic vision to navigate the complexities of an interconnected world of capital markets and global finance,” according to “Crash of the Titans,” a 2010 book about Merrill’s collapse written by Greg Farrell, now a reporter at Bloomberg News.

A “great bear of a man” with “a backslapping and gregarious nature,” as the New York Times put it in 2003, Komansky was the firm’s first Jewish CEO, after a long line of Irish Catholics. He praised Merrill as “a meritocracy” and advanced that ideal by helping to groom O’Neal, who in 2002 became the first Black CEO of any major Wall Street firm.

Komansky “was a larger-than-life figure, with a tremendous sense of humor,” Paul Critchlow, Merrill’s head of communications and public affairs when Komansky was CEO, said in an interview Tuesday. “He was a great people person — so good at winning people over and making them feel like one of the gang.”


Komansky’s buying spree augmented Merrill’s mostly U.S.-focused investment bank and retail brokerage. From the end of 1996 to the end of 2000, Komansky increased Merrill’s workforce by 19,000 employees, or 35%. Acquisitions included Mercury Asset Management, the No. 1 U.K. fund manager, for $5.3 billion; Yamaichi Securities Co., a failed Japanese brokerage; Midland Walwyn Inc., Canada’s last major independent brokerage, for about $780 million in stock; and a 51% stake in Phatra Securities, Thailand’s largest investment bank.

In the bear market that followed, Merrill plummeted from $80 a share in January 2001 to $28.43 in October 2002, and the firm slashed its operations in Japan and Canada. Komansky said the drop was the worst of his career.

“I used to think that the one in the early ’70s was not to be repeated, and I took great comfort in feeling that, ‘Well, I had that early in my career and I’ll never have to go through it again,’” he said in a 2002 interview. “I was wrong. This one has turned out to be much more devastating.”


Also in 2002 the firm suffered a black eye from New York Attorney General Eliot Spitzer’s investigation into how Wall Street firms used stock research to win investment banking business. Spitzer’s report singled out Merrill’s investment advice as “tainted” and said the firm must disclose when the topic of research is an investment banking client or prospective client. Merrill eventually agreed to pay $200 million as one of 10 firms that settled allegations over biased research.

At the company’s annual meeting in April 2002, Komansky apologized for emails sent by some of the firm’s research staff, including internet analyst Henry Blodget, in which they privately denigrated stocks that they had recommended in public reports to investors.

Komansky’s plan to remain CEO until his 65th birthday in 2004 was foiled by O’Neal’s rapid accretion of power. As president, O’Neal moved swiftly to cut expenses and staff following the terror attacks of Sept. 11, 2001, which killed three Merrill employees and damaged its lower Manhattan headquarters. Komansky ceded the CEO post at the end of 2002 and left as chairman in April 2003.


David Herman Komansky was born on April 27, 1939, in Mount Vernon, New York, one of two boys born to an Irish Catholic mother who had converted to Judaism upon marrying her husband, a postal worker. Komansky was raised in the Bronx.

In 1956, after he graduated from high school, the family moved to Miami, where Komansky attended Miami Dade Junior College. In 1968, having dropped out of the University of Miami, the 29-year-old was doing odd jobs when the father of his future wife helped him secure a position as a broker in Merrill’s Forest Hills, New York, office.

Komansky “never forgot where he came from,” Critchlow said.

Managing the firm’s Manhasset, New York, office from 1977 to 1981, Komansky became known for ringing a bell when a broker made a big sale. He also was known for the full-throated laugh that emanated from his 6-foot, 4-inch frame.

The promotions continued: Midwest regional director, New York regional director, national sales director for the private-client group in 1988, chief of equity sales in 1990, head of debt markets in 1992 and executive vice president for debt and equity markets in 1993.

In January 1995, then-CEO Daniel Tully named Komansky president, chief operating officer and his likely successor. Tully died in 2016.

Komansky and his wife, Phyllis, had two daughters, Jennifer and Elyssa, and two grandchildren.

The post Former Merrill CEO David Komansky dies at 82 appeared first on InvestmentNews.

Andrew is half-human, half-gamer. He’s also a science fiction author writing for BleeBot.

Andrew Vincent
Andrew is half-human, half-gamer. He's also a science fiction author writing for BleeBot.
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