Bear Stearns Looking for Cayne Successor: Sources

Bear Stearns's board is talking about a successor for Chief Executive Jimmy Cayne, CNBC has learned.

Critics say Cayne plays too much golf and bridge while the company suffered steep losses on subprime mortgages. Bear Stearns, a leading underwriter of mortgage-backed bonds, was seen as one of Wall Street's savviest players in evaluating the risk of mortgage-related securities.

But the company's reputation took a blow this summer when two Bear-run hedge funds collapsed due to bad bets on subprime-related investments.

Some analysts and investors have suggested Cayne might relinquish his role as CEO to Bear Stearns President Alan Schwartz while keeping his role as company chairman.

Bear Stearns Executives To Forgo Bonuses

The Wall Street Journal also reports that top executives at Bear Stearns, including Cayne, will forgo bonuses for this year in an acknowledgment of the difficult period facing the company.

According to the Journal, Bear Stearns just barely met a return-on-equity standard mandated by the current executive compensation plan.

Bear Stearns

was not available for comment. The company reports fiscal year-end results Thursday.