Filed under: Industry, Employees, Merrill Lynch (MER), Goldman Sachs Group (GS)

Thomas Montag, the new head of of global sales and trading at Merrill Lynch (NYSE: MER), better be worth it. Everyone now knows about his pay package. In a government filing, documents show that he’ll be guaranteed $39.4 million in 2008. Beyond that Merrill is buying out his holdings in his former employer Goldman Sachs (NYSE: GS). According to The Wall Journal, “one person close to Goldman estimated that the hodgepodge of stock-based holdings is worth at least $50 million.”

The numbers look huge and make nice headlines, but the fact of the matter is that Montag is probably worth it. Merrill’s losses have knocked it out of the top tier of brokerages in the minds of many investors. At Goldman,Montag’s people made money when most peers were losing buckets. The fact that he is willing to go to MER should calm some shareholders.

The compensation is unique because Montag has this double value to Merrill. He is a gifted trader and executive. And, coming to Merrill is a sign that the firm isn’t toast. Montag is no idiot.

But, Merrill’s problems are not behind it, so Montag probably took his money up-front.

Douglas A. McIntyre is an editor at 247wallst.com.

Share This

Share This

This entry was posted on Tuesday, May 6th, 2008 at 8:15 am and is filed under Industry News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.