Disgraced ex-Merrill Lynch chief John Thain went on a p.r. blitzkrieg yesterday defending a reputation in tatters since he was ousted Thursday by Bank of America boss Ken Lewis.
In what is turning into a Wall Street version of "he said, he said," Thain sent a memo to Merrill Lynch employees and made a TV appearance in a bid to reverse some of the damage done by his inglorious dismissal last week.
Meanwhile, BofA spent yesterday putting out its own spin on events.
Lewis, during a 15-minute meeting Thursday, asked Thain to resign following reports that Merrill had pushed through up to $4 billion in bonus payments and after Merrill revealed a $15 billion fourth-quarter loss that was said to have caught the BofA chief by surprise.
The losses forced BofA to go hat in hand to ask Uncle Sam for $20 billion in rescue funds and secure a $118 billion backstop on securities that Merrill created.
That same day came reports that Thain spent $1.2 million renovating his office at Merrill, which was already well in the throes of the credit crisis that led to the axing of Thain's predecessor, Stan O'Neal.
Thain's offensive began with a memo refuting charges that he pushed through the bonuses days before BofA completed its acquisition of Merrill, saying that bonuses "were all determined together with Bank of America."
He later appeared on CNBC, saying that he was "surprised" that he had been asked to leave after just 20 days with the combined company. He added that losses at Merrill were due to "market deterioration" on assets Merrill was trying to unload.
Lewis through a spokesman flatly denied that he rubber-stamped Thain's bonus payments at Merrill.
"John Thain and the Merrill Lynch compensation committee made the decision on the amount and timing of the year-end compensation at Merrill Lynch," said the spokesman, Scott Silvestri. "We had no legal right to challenge it."
Nevertheless, observers told The Post that even though the bonuses went through before the BofA-Merrill deal closed Jan. 1, it was hard to believe Lewis couldn't nix the payments if he had wanted to.
Sources told The Post that Lewis in fact was not blindsided by Merrill's losses, and axed him after questioning his "effectiveness as a leader and manager."
Thain also argued on CNBC that the lavish office renovation was done during a "different economic environment and a very different outlook for Merrill."
"With 20/20 hindsight, it was a mistake," he said. "And, as I said, I'm sorry that we, that I did that. And I'm willing and I - and I intend to fully - reimburse the company."
The CNBC interview depicted a humble Thain who found himself many times during the interview correcting himself in mid-sentence, changing "we" to "I" as he described his side of events at Merrill.