Goldman's Thain to join NYSE as chief executive

The New York Stock Exchange yesterday appointed Mr John Thain, president of Goldman Sachs, as chief executive, ushering in a new era for the world's largest stock exchange after one of the worst crises in its 211-year history.

Mr Thain (48) will start on January 15th, succeeding Mr John Reed, the interim chairman, who has resigned as chief executive and will assume the position of non-executive chairman.

Mr Thain said he had not yet drawn up a specific agenda but he was expected to implement wide-ranging reforms.

One of his first priorities will be to address criticism of the specialist system, in which buy and sell orders are matched by a select group of traders.

Critics said that specialists had abused their privileged position and the Securities & Exchange Commission was investigating possible trading violations. Mr Thain also said yesterday that he expected more trades to be executed electronically in the future.

Mr Reed called Mr Thain "unusually able" and said that he brought to the NYSE "integrity, intelligence and extensive knowledge of the financial markets".

The appointment brings closer a swift transition following the controversial dismissal of Mr Richard Grasso as chairman and chief executive in mid-September after furore over his $187.5 million (€151 million) pay package.

"This is a tremendous opportunity and challenge, and I am deeply honoured," Mr Thain said yesterday.

His appointment was a "call to service" and he appealed to NYSE staff and member firms: "Let us work as one to restore investor confidence."

The appointment led to a reordering of executives at Goldman, which named star bond trader Mr Lloyd Blankfein as president and chief operating officer, making him the heir apparent to Mr Hank Paulson, the chairman and chief executive.

However, Mr Paulson (57) is unlikely to leave Goldman soon, which was one of the reasons that Mr Thain gave for taking the chance to run the NYSE.

The Goldman Sachs veteran will be paid a total of $4 million a year, including bonuses, and without a contract for a predetermined length of time. - (Financial Times Service)