Merrill executive to leave firm

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Merrill Lynch is parting company with co-president Ahmass Fakahany, one of the architects of the firm's decision to invest in sub-prime mortgages.

The US investment bank, which made a $14.1bn (£7bn) loss on bad sub-prime debt last year, said Mr Fakahany would leave on 1 February.

Before his promotion to co-president last May, Mr Fakahany was responsible for market risk management at Merrill.

His departure comes after former boss Stan O'Neal left Merrill in October.

Reports said Mr Fakahany was a close ally of Mr O'Neal.

Wider problem

Merrill's new chief executive, John Thain, described Mr Fakahany as a "consummate professional".

"He provided leadership during this challenging period and has transitioned the new team," said Mr Thain.

Analysts have blamed poor risk management for Merrill's over-exposure to bad sub-prime mortgage debt.

However, the bank was far from alone. Most of the main US banks have also had to unveil substantial losses linked to sub-prime investments of their own.

The knock-on effect has been the global credit squeeze, as banks worldwide have been much less willing or able to lend money until the full extent of sub-prime losses is known.