The CEO who spent $1.2 million renovating his office and arranged $3.6 billion in executive bonuses while his company, Merrill Lynch, was circling the toilet bowl, has just been named CEO of CIT Group. John Thain rises to the top of a public company again a year after he was jettisoned by Bank of America after it acquired Merrill Lynch. Thain inherits a firm struggling since former Merrill colleague and ex-CEO Jeffrey Peek immersed the company in subprime mortage lending before its bankruptcy.
If Thain "can pull this off, he’s going to be the king," an analyst tells Bloomberg. CIT is still operating under conditions tied to its 2008 federal bailout, and is barred from the commercial paper market, which has traditionally been a key source of income for the firm. CIT provides business loans to more than 3,000 companies and employs some 4,500 workers. Thain will reportedly be paid a $500,000 salary and receive $5 million in shares.