TOKYO (Reuters) - Investment bank Merrill Lynch & Co Inc <MER.N> does not plan to raise more capital and will continue to shrink its balance sheet amid the global credit crunch, Chief Executive John Thain said on Tuesday.
By David Dolan
TOKYO (Reuters) - Investment bank Merrill Lynch & Co Inc <MER.N> does not plan to raise more capital and will continue to shrink its balance sheet amid the global credit crunch, Chief Executive John Thain said on Tuesday.
Thain, who met with reporters on a visit to Merrill's Tokyo offices, declined to lay out plans for job cuts but said it made sense for the bank to lower costs.
Even though Merrill has been hammered by the U.S. subprime market -- its shares are down about 45 percent over the last 12 months -- Thain said it was betting on growth, especially from outside the United States.
!ADVERTISEMENT!"We deliberately raised more capital than we lost last year ... we believe that will allow us to not have to go back to the equity market in the foreseeable future," Thain said.
"We have not announced layoffs ... however, in this difficult environment, to focus on expenses is also a logical thing for us to do."
Separately, the chief executive of BNP Paribas <BNPP.PA> told a news conference it would be difficult for the French bank to meet its promise to match last year's investment banking revenues.
Merrill has so far written down $24 billion worth of investments related to the troubled U.S. mortgage market, which pushed the bank to a loss of more than $8 billion in 2007.
It has since raised about $12.8 billion, with about half of that coming from a group that includes Japanese, Korean and Kuwaiti investors.
While Merrill would continue to shrink its balance sheet, Thain said he was also betting on markets beyond the United States to provide growth in the future.
"I see the growth opportunities for us primarily outside the U.S. ... There's absolutely no change to our global strategy," Thain said.
(Editing by Michael Watson)
