Merrill Edge Brokers to Get Desks in Wealth Branches–Report
(Updates with comment from Bank of America spokesman.)
Bank of America is putting about 300 “financial solutions advisors” who were trained to work with bank-branch clients into traditional Merrill Lynch brokerage offices, according to a published report.
The plan aims to develop younger, less affluent prospects than those served by traditional brokers, and further imprints the bank brand on the Thundering Herd of Merrill’s almost 15,000 brokers. It was reported earlier Monday in the “Wall Street Journal.”
FSAs, who until now have worked in call centers and at bank branches under the Merrill Edge flag, will be deployed to Merrill Lynch wealth offices in major U.S. cities, according to the report. Bank of America currently employs about 2,700 low-service Edge brokers.
The move comes as traditional brokerages of all sizes are contending with ways to energize, and ultimately replace, a brokerage force whose average age is in the mid-50s, according to consultants.
Firms also are looking to develop branch-housed advisors comfortable with digital tools and prepackaged investment products that appeal to younger clients who start largely as DIY investors.
Merrill and its wirehouse rivals have exacerbated the problem of developing a next-generation of investors by raising the wealth parameters of clients serviced by experienced advisors. Merrill, for example, does not pay brokers on accounts with less than $250,000.
A Merrill spokesman said that the firm already has 27 financial solutions advisors in brokerage offices as part of a pilot program and aims to expand to 300 by the end of the year.
Merrill Edge brokers receive a mix of salary and bonuses. Traditional brokers are compensated with a percentage of the fees and commissions they generate, a potentially more lucrative “eat-what-you-kill” formula.
Morgan Stanley, which has almost 16,000 brokers, has not gone as far as putting call-center brokers in wealth branches to develop a new generation of advisors and clients. However, it plans to double its “virtual advisor” representatives who work in call centers and are incentivized to identify up-and-coming customers who can be referred to full-service branches.
Wells Fargo Advisors predated Merrill’s new model by placing some salaried “financial relationship advisors” in its Private Client Group branches to work with smaller accounts.
As part of its grand plan to coordinate bank and wealth management services, Bank of America has been sending some Edge representatives to selected branches on certain days to help with the transfer of sub-$250,000 accounts and to offer additional Edge accounts to certain wealthier clients with DIY instincts and to their offspring.
Bank of America, which bought Merrill in the depths of the financial crisis in January 2009, also assigns banking specialists to Merrill branches to help advisors pitch loans, checking and savings products to their customers.