Merrill Demotes Chiefs of Bond Department

Merrill Lynch & Co. demoted the co-heads of its bond department as Wall Street’s biggest securities firm continued a management cleanup after posting its first quarterly loss in nearly a decade. The shake-up was the second in two days at the New York firm and followed the $164-million third-quarter loss attributed to extreme volatility in bond and other financial markets. Seth Waugh, co-head of bond underwriting and trading since 1997, was demoted to the No. 2 position. Conrad Voldstad, the other co-head, will be bounced to a new job when he returns from a temporary outside assignment. On Thursday, Merrill demoted the executive responsible for managing the firm’s financial risks, Daniel T. Napoli.