(May 3) – “John “Launny” Steffens, a chief architect of Merrill Lynch & Co.’s individual-investor business for nearly two decades, is leaving the big brokerage firm,” writes Charles Gasparino in today’s Wall Street Journal.

“The move by Mr. Steffens comes 15 months after he was replaced as Merrill’s brokerage chief. He will retire, effective June 15, to launch an investment-management business catering to the very wealthy. J. Ezra Merkin, a hedge-fund manager, will join Mr. Steffens, 59 years old, in his new venture.

“Mr. Steffens headed Merrill’s private-client business from 1985 until February 2000, helping to build client assets at Merrill to about $1.6 trillion from $160 billion. With 15,000 brokers, Merrill is the nation’s largest brokerage firm.

“He makes no bones about why he is leaving. Last February, Merrill Chief Executive David Komansky replaced him with E. Stanley O’Neal, who was the firm’s chief financial officer. Mr. O’Neal, a rising star at the firm, is in the running to replace Mr. Komansky when he is scheduled to retire in 2004.

“Though Mr. Steffens remained at the firm largely as a senior adviser to Mr. Komansky, he wasn’t running a major portion of the company. Being an adviser is fine, but he would like to be an innovator, he said in an interview.

“Mr. Steffens may be best known at Merrill for his vision about the future shape of the brokerage industry. More than a decade ago, he began pushing Merrill brokers not just to handle trades, but also gather client assets. Now so-called fee-based brokerage accounts, where investors pay a flat fee for unlimited trading and advice, are commonplace in the brokerage industry.

“He also pushed Merrill into several new areas, such as insurance, mortgage lending, and banking. Merrill, which owns two banks, was one of the first big financial firms to link customers’ brokerage accounts to government-guaranteed bank deposits. He was one of the chief Wall Street lobbyists for the Roth IRA, which has become a popular investment for retirement. And when it came time for Merrill to break tradition and begin offering low-cost online trading to its clients, it was Mr. Steffens who led the effort.