Oct. 30 (Bloomberg) -- Merrill Lynch & Co.'s Stan O'Neal, ousted from his job as chairman and chief executive officer of the world's largest brokerage, left with $161.5 million of securities and retirement funds, according to a federal filing.

O'Neal won't get severance or a 2007 bonus, according to the U.S. Securities and Exchange Commission filing today by New York- based Merrill. The company said in a separate statement that O'Neal would ``retire'' effective immediately, a form of departure that allows him to keep past stock bonuses that he could have otherwise forfeited by leaving.

Merrill's board refused to give O'Neal a severance package following a record $8.4 billion writedown of subprime mortgages, asset-backed bonds and buyout loans this month. By permitting O'Neal, 56, to retire, the company lets him keep past stock bonuses that may have been based on the same type of wagers that fueled this year's losses, one compensation consultant said.

``He is walking away with a reward for risk-taking activity that, at least on the subprime side, turned out to be a disaster,'' said Brian Foley, managing director of Brian Foley & Co. in White Plains, New York. ``That to me is a problem.''

Merrill spokeswoman Jessica Oppenheim declined to comment.

O'Neal retains stock options, pension and deferred compensation already earned during his 21-year career at Merrill, according to today's filing. He'll also get an office and executive assistant for up to three years.

Exit Package

O'Neal's exit package includes unvested common stock that he received under Merrill's policy of paying bonuses in both cash and equity. According to the company's proxy statement, O'Neal held 1.36 million shares as of Feb. 28 with a current market value of more than $89 million. At the end of last year, O'Neal held 1.15 million shares that had yet to vest, the proxy statement said.

Merrill executives who receive a stock bonus risk losing some or all of the shares if they depart before a four-year waiting period has elapsed. Brokerages attach vesting periods to discourage executives from defecting to rivals.

The firm provides an exception for executives who retire once their combined age and length of career at Merrill totals at least 60 years. Because O'Neal is over this threshold, he won't forfeit any restricted shares that have yet to vest, as long as he adheres to confidentiality requirements and doesn't go to work for a competing firm for 18 months, according to a separation agreement included in today's filing.

The agreement, dated Oct. 30, permits O'Neal to start his own business ``at any time'' if it isn't affiliated with a competitor.

Stock Options

In addition to his stock, O'Neal held options to buy 1.88 million Merrill shares at prices ranging from $36.06 to $77.56. Assuming he could exercise all of his profitable options at today's share price, O'Neal's gains would total more than $35 million.

O'Neal would receive a pension whose present value is about $24.7 million and retain about $5.4 million in deferred compensation accounts, the filing said.

The filing put the combined value of O'Neal's restricted shares and options at $131.4 million. That figure is for the end of business Oct. 29, when Merrill shares closed at $67.42 each.

Merrill shares declined $1.86 to $65.56 at 4:25 p.m. in New York Stock Exchange composite trading. The shares have dropped more than 29 percent so far this year.

To contact the reporter on this story: Miles Weiss in Washington at mweiss@bloomberg.net.

Last Updated: October 30, 2007 18:27 EDT