In the bear market that followed, Merrill plummeted from $80 a share in January 2001 to $28.43 in October 2002, and the firm slashed its operations in Japan and Canada. Komansky said the drop was the worst of his career.

“I used to think that the one in the early ’70s was not to be repeated, and I took great comfort in feeling that, ‘Well, I had that early in my career and I’ll never have to go through it again,’” he said in a 2002 interview. “I was wrong. This one has turned out to be much more devastating.”

‘Tainted’ Research
Also in 2002 the firm suffered a black eye from New York Attorney General Eliot Spitzer’s investigation into how Wall Street firms used stock research to win investment-banking business. Spitzer’s report singled out Merrill’s investment advice as “tainted” and said the firm must disclose when the topic of research is an investment-banking client or prospective client. Merrill eventually agreed to pay $200 million as one of 10 firms that settled allegations over biased research.

At the company’s annual meeting in April 2002, Komansky apologized for emails sent by some of the firm’s research staff, including internet analyst Henry Blodget, in which they privately denigrated stocks that they had recommended in public reports to investors.

Komansky’s plan to remain CEO until his 65th birthday in 2004 was foiled by O’Neal’s rapid accretion of power. O’Neal, as president, moved swiftly to cut expenses and staff following the terror attacks of Sept. 11, 2001, which killed three Merrill employees and damaged its lower Manhattan headquarters. Komansky ceded the CEO post at the end of 2002 and left as chairman in April 2003.

First Job
David Herman Komansky was born on April 27, 1939, in Mount Vernon, New York, one of two boys born to an Irish Catholic mother who had converted to Judaism upon marrying her husband, a postal worker. Komansky was raised in the Bronx.

In 1956, after he graduated from high school, the family moved to Miami, where Komansky attended Miami Dade Junior College. In 1968, having dropped out of the University of Miami, the 29-year-old was doing odd jobs when the father of his future wife helped him secure a position as a broker in Merrill’s Forest Hills, New York, office.

Komansky “never forgot where he came from,” Critchlow said.

Managing the firm’s Manhasset, New York, office from 1977 to 1981, Komansky became known for ringing a bell when a broker made a big sale. He also was known for the full-throated laugh that emanated from his 6-foot, 4-inch frame.

The promotions continued: Midwest regional director, New York regional director, national sales director for the private-client group in 1988, chief of equity sales in 1990, head of debt markets in 1992 and executive vice president for debt and equity markets in 1993.