Bank of America-Merrill Lynch (BAC) is reportedly selling its non-U.S. wealth-management units, Reuters said Tuesday, with the goal of raising $3 billion. The units are managing an estimated $90 billion in client assets, according to sources cited in the report, and they likely include several hundred advisors, experts state.
“We are committed to our clients and businesses globally but, in keeping with our policy, we do not comment on market rumors and speculation,” a BofA spokesperson told AdvisorOne in a statement.
Recruiters have mixed views on the news. Some believe it’s a good long-term move. But others insist that it creates more uncertainty and thus hurts Merrill in the short term as nervous advisors consider leaving the thundering herd.
“When a firm is seeking to boost it’s Tier 1 Capital, a non-core business has to be either scaled up or shut down,” said executive-search consultant Mark Elzweig (left) in an interview.
The ever-increasing expense of maintaining the infrastructure for compliance and operations associated international accounts justify such a move, says the New York-based Elzweig. “It’s not surprising that Bank of America chose to unload this business.”
The move to refocus on its core business should “makes Merill Lynch more of a crown jewel in the eyes of Bank of America than before,” the consulant says. Still, he admits, the move “will undoubtedly fuel speculation that Bank of America will either spin off or sell Merrill Lynch, and that’s a separate issue.”