The New York Times-20080129-Risk Management Executive Is Leaving Merrill Lynch

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Risk Management Executive Is Leaving Merrill Lynch

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Merrill Lynch & Company said on Monday that a president, Ahmass L. Fakahany, would leave as the firm builds a new management team after an implosion in the credit market that caused $12 billion in net losses in the second half of 2007.

Mr. Fakahany's departure is effective Feb. 1. No successor was announced.

Before his promotion in May to president, Mr. Fakahany's duties included responsibility for market risk management as Merrill's portfolio of risky collateralized debt obligations, or C.D.O.'s, surged.

Exposure to the subprime-laden debt vehicles backfired. Soured C.D.O. positions were mostly to blame for Merrill's $24 billion in write-downs last year and huge net losses.

Mr. Fakahany oversaw Merrill's market risk management from March 2005 until May 2007, when he was named co-president along with Gregory J. Fleming, a star investment banker at the company. Mr. Fakahany joined Merrill Lynch in 1987 and served in a variety of senior roles, including chief financial officer.

In a statement, the chief executive, John A. Thain, described Mr. Fakahany as a consummate professional.

Upon my arrival, Ahmass informed me of his intention to transition out of Merrill Lynch in the first quarter and pursue other interests, Mr. Thain said. He provided leadership during this challenging period and has transitioned the new team.

Analysts and investors blame poor risk management for Merrill's exposure to securities underpinned by subprime mortgages.