John Thain, the former CEO of Merrill Lynch and NYSE Euronext (NYX
) is the top candidate for the CEO job at CIT. CIT recently emerged from Chapter 11, but it still faces problems raising the capital required to make the thousands of loans to small and medium-sized business that are its major activity. CIT has formed a bank that it hopes will take in enough deposits to underwrite the balance of its traditional operations. But many of its former clients are likely to be gun-shy about doing business with a company which has had such deep financial problems.%%DynaPub-Enhancement class="enhancement contentType-HTML Content fragmentId-1 payloadId-61603 alignment-right size-small"%%Thain was fired from Bank of America (BAC
) after it bought Merrill. Before that, he was briefly mentioned as a successor to Bank of America CEO Ken Lewis. Thain's role in the controversial bonuses paid to Merrill employees as the broker closed its deal with Bank of America are part of Thain's legacy, as are questions about when Bank of America found out about fourth-quarter losses at Merrill, which totaled nearly $16 billion.
It's shocking that the CIT board would seriously consider Thain for the job. He is still under a cloud for his actions at Merrill, although he claims that he saved the company by selling it to Bank of America. The federal government is still investigating the buyout of Merrill, and it's not entirely clear that Thain is free from scrutiny in that probe.
CIT should do better than to hire a man who is notorious in some circles for poor judgment and a checkered career.