He was designated to become president of global banking, securities, and wealth management at the newly combined company, but resigned on January 22, 2009.
Ken Lewis, CEO of Bank of America, reportedly forced Thain to step down after several controversies, such as the losses at Merrill Lynch which proved to be far larger than previously estimated, and the award of huge executive bonuses.
Thain worked at Goldman Sachs, as head of its mortgage securities division from 1985 to 1990,[6] and president and co-chief operating officer from 1999 to 2004.
In December 2003, interim chairman John Reed at the New York Stock Exchange told The Wall Street Journal that Thain would be paid "a plain vanilla number", about $4 million a year including bonuses, with no "strange retirement" program like the one former NYSE CEO Dick Grasso was given.
[8][9] Merrill Lynch and Citigroup sought new leaders following the sudden departure of their former CEOs after the disappointing performance in the third quarter of 2007 due to the subprime mortgage crisis.
[16][17][18][19] Thain accelerated approximately $4 billion in bonus payments to employees at Merrill just prior to the close of the deal with Bank of America.
[22] Merrill was still an independent firm at the time, and some analysts predicted that, with Thain as new CEO, the company would be back on track for a strong performance in the midst of disappointing results on Wall Street.
Nelson Chai, Merrill's last CFO prior to its merger, was initially slated to relocate to Hong Kong to head Bank of America's Asia business.
[25] Thain and Chai's departures left just one other member of Merrill's management team at the combined company, Tom Montag, as head of sales and trading.
[26] On January 23, 2009, President Obama referred to Thain by saying "the reports that we’ve seen over the last couple of days about companies that have received taxpayer assistance then going out and renovating bathrooms or offices or in other ways not managing those dollars appropriately."
White House press secretary Robert Gibbs also said taxpayer money shouldn't go to "line the pockets of people" who had gotten financial assistance.
"The American people need to be greatly assured that their hard-earned money is not going to the bonuses or the remodeling of an office at a bank that's in trouble," Gibbs said.
"[29] On January 27, 2009, New York Attorney General Andrew Cuomo issued a subpoena to Thain in a probe into the bonuses he received just days before the Bank of America takeover.
[30] On February 7, 2010, Reuters reported that CIT Group had announced that it was hiring Thain to replace interim CEO Peter Tobin.