The chief executive officer of Bear Stearns Cos., James “Jimmy” Cayne is facing pressure to step down as the securities firm’s shares languish following unprecedented losses from mortgage holdings coupled with declines in trading and investment banking. Bear Stearns has fallen 53% in the past year, more than any of its Wall Street rivals. The New York-based firm’s fourth-quarter loss of $854 million was the first in its history, and prompted Moody’s Investors Service to cut the company’s credit rating one level to A2, the lowest since 2003.

Mr. Cayne, 73, began notifying members of his board Sunday that he plans to give up his role as CEO and remain chairman, the Wall Street Journal reported on its Web site yesterday, citing people familiar with the matter. He’s expected to be succeeded by the president of the company, Alan Schwartz, the paper said. A Bear Stearns spokesman, Russell Sherman, didn’t reply to an e-mail and phone call seeking comment.

Mr. Cayne and senior managers agreed to forgo bonuses for 2007 after producing “unacceptable results,” he said last month. The company’s $1.9 billion mortgage writedown wiped out revenue for the three months ended November 30. Lehman Brothers Holdings Inc., Morgan Stanley, and Goldman Sachs Group Inc. posted gains for the quarter from trading stocks and advising on mergers. Bear Stearns’s return on equity dropped to 1.8% for 2007 from 19% the year before. Morgan Stanley reported a 7.8% return; Lehman generated 21%.