Merrill To IPO ?

As 'big' is no longer beautiful, and 'too big to fail' has morphed into 'to big to exist', some feel that, before too long, Bank of America will have no option but to set Merrill Lynch free and return it to the wild. Bill Smith, president and CEO of SAM Advisors, told CNBC last week: 'Bank of America, in my opinion, is going to fail as a conglomerate....Once Bank of America gets through this credit crisis, in two or three years, there's a very good likelihood that you're going to see an IPO of Merrill Lynch...and there's a possibility that Merrill Lynch can be a publicly traded company again'.

In the meantime, Reuters reports that Goldman Sachs CEO Lloyd Blankfein was sounding somewhat bullish last week. He told shareholders at the firm's annual meeting Friday: 'My hope, and my guess, is that business feels like it's off it's lowest ebb'. Blankfein also confirmed that Goldman wants to quickly repay its US government TARP borrowing, and that he was waiting for guidance from the government about how to do so.

The Financial Times reports that US regulator the Securities and Exchange Commission may sue JPMorgan Chase over alleged violation of securities laws in connection with the sale of bonds and interest-rate swaps to Jefferson County, a municipality which is struggling to avoid default o $3bn of its debt.

And Reuters reports that AIG reported its smallest loss in 6 quarters last week. It's first-quarter loss came in at $4.35bn, taking losses in the last 18 months to over $100bn.

Finally, better news over at WestLB, as CEO Heinz Hilgert told Der Spiegel that his firm had just enjoyed its best-ever first-quarter.