Merrill Lynch

  • LTCM – Long Term Capital Management
  • Monarch
  • Money Market Funds
  • CDO's - 2008
    • 2010 0304 - FCIC - Notes from Michael Lewis Interview on the topic of the Origins of CDOs markets in Nonbanks - 1p
      • The Merrill Lynch CDO machine was bigger, and produced CDOs of vastly inferior quality, to those of the other banks.
  • Stan O’Neal, CEO 
  • Jeffrey Edwards, CFO
  • Donald Regan
    • 1946-1980 - Merrill Lynch
      • 1971-1980 - Chairman and CEO
    • 1981 to 1985 - United States Secretary of the Treasury 
    • 1985 to 1987 - White House Chief of Staff 
    • "Wall Street is hiding behind a protective pricing system while it preaches free competition and free markets," he said in a 1970 speech. "That is like catching Carrie Nation [the Prohibition advocate] tippling in the basement."
      • 2003 0611 - The Washington Post - Donald Regan Dies - [link]
  • When the product was launched, SEC ruled that one was allowed to illustrate a variable life product assuming a growth rate of only 8 percent in the underlying funds.
  • The resulting cash values were not much better than the old participating product.
  • When Monarch Life filed their prospectus, they managed to persuade the SEC that 8 percent was out of date and that 12 percent should be used.
  • Everybody used 12 percent, and the resulting variable product values were much better than those under the traditional participating product.

  • Should a little company go after a big investment name?

    • Monarch has done well with the Merrill Lynch name.

--  Michael R. Tuohy

1985 - SOA - Variable Universal Life Insurance, Society of Actuaries - 22p

  • 2013 1021 - New York Securities Blog - Merrill Lynch Loses a $1.2 Million Arbitration Award Regarding the Sale of a Variable Universal Life Insurance Product – The Merrill Lynch Funds Estate Investor II, By Lax & Neville LLP - [link]

MR. CHAPMAN:  My understanding is that Merrill Lynch is waiting for a private letter ruling on something that challenges the issue more dramatically.

  • They are issuing a Universal Life policy with a variable death benefit tied to a number of separate accounts, each of which is managed by Merrill Lynch.
  • It is a case of having, on the one hand, a variable benefit tied to a separate account and, on the other hand, an additional amount of term insurance - a combination of Universal Life and variable life.
  • That private letter ruling will be informatlve.
  • WALTER N. MILLER:  I have three comments.
    • The first is on the Merrill Lynch product.
    • As some of us read their prospectus, it is not a Universal Life product. It is rather something akin to the Equitable design of a variable life policy as proposed originally by Harry Walker in his discussion of our 1969 paper.
    • This sort of variable life design has received some solid tax rulings.
    • 79-87 is one of them from the policyowner standpoint.
    • What happens with the Merrill Lynch ruling request may have little to do with the ultimate outcome of Universal Life.

1981 - SOA - The Future of Permanent Life Insurance (rsa81v7n12), Society of Actuaries - 22p