Merrill

Following the departure of one of the founders, the company is renamed A.A. Housman & Company, which soon becomes one of Wall Street's leading brokerage houses. Merrill, Lynch & Company is formed by Charles Merrill and Edmund Lynch. Merrill and Lynch, aiming to concentrate on investment banking, sell their retail business to E.A. Pierce. Firm is renamed Merrill Lynch, Pierce, Fenner & Beane following the acquisition of New Orleans-based Fenner & Beane. With the departure of Alpheus Beane, Jr., and the naming of Winthrop Smith as a directing partner, the firm changes its name to Merrill Lynch, Pierce, Fenner & Smith. Company expands into international banking through acquisition of Brown-Shipley Ltd., which is soon renamed Merrill Lynch International Bank. A new holding company is formed called Merrill Lynch & Co., Inc., with Merrill Lynch, Pierce, Fenner & Smith becoming its principal subsidiary. Merrill Lynch introduces the Cash Management Account, an innovative integrated-investment vehicle aimed at individuals. The leading independent securities firm in England, Smith New Court PLC, is acquired. Mercury Asset Management PLC, the leading U.K. money management firm, is acquired. Merrill Lynch Direct, a web site offering online trading of securities, debuts. Merrill Lynch's oldest direct predecessor was the partnership of Burrill & Housman, founded in 1885. In 1890 William Burrill left the firm he had created, and the next year Arthur Housman's brother Clarence joined what was then A.A. Housman & Company. When Arthur Housman died in 1907, he left behind one of Wall Street's leading brokerage houses. That same year, Charles Merrill and Edmund Lynch arrived in New York, where they met and became friends. The two 22-year-old entrepreneurs had both recently finished college and gravitated to Wall Street to seek their fortune. At that time, the stock market was chiefly the domain of a small number of eastern businessmen, but Merrill quickly realized the vast potential of financial markets funded by a broad spectrum of middle-class Americans. He received his initial training in the bond department of Burr & Company, and then set up his own firm in 1914. The following year he persuaded Edmund Lynch to join him, and Merrill, Lynch & Company was born. The company prospered and grew quickly, earning a strong reputation in financial circles for financing the newly emerging chain-store industry. Merrill himself was a founder of Safeway Stores, and the company underwrote the initial public offering for McCrory Stores. By the late 1920s, Merrill, Lynch was reaping the benefits of that decade's prolonged economic boom, but Charles Merrill gradually became uneasy about the frantic pace of investment. He predicted that bad times were ahead as early as 1928, warning his clients and his own firm to get ready for an economic downturn. When the crash came in 1929, Merrill, Lynch had already streamlined its operations and invested in low-risk concerns. Despite this foresight, in 1930 Merrill and Lynch decided to sell the firm's retail business to E.A. Pierce & Company and concentrate on investment banking. E.A. Pierce & Company was the direct descendant of A.A. Housman & Company. The company was named for Edward Allen Pierce, who had joined Housman in 1901, become a partner in 1915, and the managing partner in 1921. After World War I, Pierce concentrated on building the firm into a nationwide network of branches connected by telegraph, in order to reach more customers. After a 1926 merger with Gwathmey & Company, the firm was renamed E.A. Pierce & Company the following year. Like most brokers, Pierce struggled through the Depression years, and in 1939 he persuaded Charles Merrill to rejoin him in the retail business. In 1940 Merrill Lynch, E.A. Pierce & Cassatt opened its doors, dropping the comma between Merrill and Lynch for the first time and adding Cassatt & Co., a Philadelphia firm that had sold part of its business to Pierce an