Merrill Lynch today reported third- quarter net earnings of $422 million (All amount in U.S. dollars).

Basic earnings per common share were 49¢, compared with $1.09 in the third quarter of 2000. Third quarter earnings include 6 cents per diluted share of September 11th-related expenses associated with the tragic attack on the World Trade Center.

Operating earnings of $475 million, which exclude September 11th-related expenses, were 12% lower than the 2001 second quarter and 46% below last year’s third quarter. Third quarter earnings include $152 million in severance expenses.

Net revenues were $5.1 billion, 8% and 16% lower than the second and year-ago quarters, respectively. The operating pre-tax profit margin for the quarter was 15.0%, essentially unchanged from the second quarter as reductions in expenses kept pace with the decline in revenues.

“While our results are reasonable given a business environment that was deteriorating even before the terrorist attacks of September 11, we are not satisfied with them. We are accelerating actions throughout all of our businesses to improve profit margins,” said David H. Komansky, chairman and CEO, and Stan O’Neal, president and COO.

“The near-term environment remains extremely weak, leading to over- capacity throughout the industry. Longer-term, the global forces driving growth in financial services remain in place. We have the market position, the leadership and the strategic resolve to capitalize on these growth opportunities for our clients, shareholders and employees.”