DEFINITION of Merrill Lynch & Co.
Merrill Lynch & Co. was a prominent independent brokerage house at 7 Wall Street and founded by Charles E. Merrill in 1914. In 2008-2009, the company was acquired by the Bank of America, and it is now known as Merrill Lynch Wealth Management. It handles over $1.2 trillion in assets from clients in countries world-wide.
BREAKING DOWN Merrill Lynch & Co.
Within a year of its founding, Merrill invited fellow investor Edmund C. Lynch to join his firm and the title of the company changed to Merrill, Lynch & Co. in 1915. As a company, Merrill Lynch & Co. helped with the financial backing needed by emerging companies and together they made some promising investments in such companies as RKO Pictures, and later, the Safeway grocery chain.
Growth of 'Merrill Lynch & Co.'
By 1930, the company divested itself of its retail brokerage business and trimmed its sails towards investment banking. At that time, the company sold the retail division to E. A. Pierce and Co, only to later acquire all of E. A. Pierce in 1940. At the same time, Merrill Lynch also acquired Cassett & Co and for a short while the company was known as Merrill, Lynch, E. A. Pierce and Cassett.
Other acquisitions and name changes followed until 1952, when the company reformed itself as a holding company to “hold” the outstanding stock of companies based on their capital reserves. At that time, the company was then known as Merrill Lynch, Pierce, Fenner & Beane. The company held its own as a solid investment firm, evidenced by offices in close to a hundred cities and its name on 28 different exchanges.
Merrill Lynch & Co. continued its upward climb until the end of the 20thcentury, acquiring other firms to offer services in retail brokerage markets and securities trading. This in turn allowed the company to offer new products within the money market exchanges, as well as investment opportunities for its clients interested in the government securities market.
Much of the success of the company owed itself to its brokerage network of over 15,000 and its name recognition as an almost household name to its clients through the United States and abroad. The company itself didn't go public until 1971, but by that time had the ability to move stocks, securities and bonds based on its interests and that of its clients.
'Merrill Lynch & Co.' and Bank of America
Like many on Wall Street, Merrill Lynch posted significant losses in the wake of the subprime mortgage crisis of the early 2000s, and began posting losses due to the crisis in November of 2007. The $8.4 billion in losses reported led the company to sell off underperforming assets, and in 2008, the company again presented losses of close to $5 billion. This led to a decline in the value of the company’s stock, and an offer by Bank of America to acquire Merrill Lynch was accepted in September of 2008. Today the company is known as Merrill Lynch Wealth Management, and the company is a wholly owned subsidiary of the Bank of America.