BofA Escalates Cross-Selling Pressure by Promoting Merrill Managers
Upping the pressure on Merrill Lynch Wealth head John Thiel to sell more bank products to the firm’s wealthy clientele, Bank of America is giving senior Merrill branch executives responsibility for local commercial banking offices.
The bank this week promoted Vince Fertitta to “market president” of its San Antonio, Texas, region, supplementing his continuing role as manager of Merrill’s so-called Lone Star market of nine offices and 160 brokers in Texas and Arizona. The complex runs about $19 billion of client money, the bank said in a news release.
Underscoring the importance of cross-selling to the banking giant’s revenue strategy, BofA Chairman and Chief Executive Brian Moynihan said in the release that Fertitta “will ensure we’re helping to make our customers’ and clients’ financial lives better, through the power of every connection we can make with them.”
A former Merrill regional manager said the strategy of seeding bank markets with Merrill wealth leaders is meant to create accountability for Merrill managers and, ultimately, Thiel. By having one of their own in a key consumer banking position, brokers can no longer point fingers at their bank cousins for being uncooperative, inaccessible or, as some brokers still say, not sophisticated enough to service Merrill’s high-end clients, he said.
A Merrill spokeswoman would not specifically comment, but said managers from all parts of Bank of America — including 24 from wealth management — serve as bank market presidents.
Bank of America, Morgan Stanley, UBS AG and Wells Fargo have all been using carrots and sticks to get their financial advisors to promote jumbo mortgages, lines of credit and other banking products and services to their brokerage clients. They urge brokers to promote them as part of a broad “wealth management” package that helps cement clients to the firm and the parent bank.
Merrill in 2015 held back some deferred compensation awards from brokers who did not make a single referral to their bank counterparts, and this year is snipping one percentage point of credit related to deferred compensation bonuses if they fail to make the referral. Many brokerage team web pages now include the name of a bank contact.
Embedding Merrill managers into the banking infrastructure reverses the strategy of putting bankers in senior sales positions at Merrill that Bank of America has tried with middling success. In 2014, it named Kim Ruth, the bank’s former Texas bank president, as director of Merrill’s southwest region, a move that required her to relocate to California. She left after three months in the role.
In December, Paul Lambert, a Merrill Lynch division executive in Chicago, assumed the additional role of Bank of America’s Chicagoland market president.
Fertitta began his brokerage career at Lehman Brothers in 1992, shortly before it merged with Smith Barney, according to BrokerCheck.