Bank of America’s Global Wealth and Investment Management unit, which includes Merrill Lynch and U.S. Trust, reported net income of $813 million vs. $720 million in the third quarter of 2013 and $726 million in the prior quarter. Revenue increased about 1% from the year-ago quarter and 7% from Q2’14 to nearly $4.7 billion.
The group’s pre-tax margin was 27.4%, up from the year-ago margin of 25.5%, marking the seventh straight quarter over 25%. Client balances increased 8% from the year-ago quarter to $2.46 trillion.
Third-quarter 2014 long-term assets under management (AUM) flows were $11.2 billion. AUM was $888 billion. GWIM says it “successfully completed the national rollout” of Merrill Lynch One, an investment-management platform with a single view of clients’ holdings across their accounts. As of Sept. 30, 2014, the platform included over $157 billion of AUM.
As for its advisor headcount, BofA says it has some 15,868 advisors—up from 15,560 in the prior quarter and 15,624 a year earlier. Excluding advisors in the consumer and business-banking segments, the group includes 14,000 registered reps, an increase of 155 from last quarter.
As of Sept. 30, 47.3% of Merrill Lynch advisors “had 50% or more of their client assets under a fee-based relationship,” the group reports.
Merrill Lynch advisors had average yearly fees and commissions of $1.077 million as of Sept. 30, 2014, up from about $1.06 million as of June 30, 2014, and $1.0 million as of Sept. 30, 2013. Veteran advisors have annual production of about $1.4 million.
Morgan Stanley’s Wealth Management net revenues were nearly $3.8 billion in the third quarter, a 9% jump from a year ago and a 2% increase from the prior quarter. Net income improved 17% year over year and 6% from Q2’14 to $501 million. This bumped the group’s pretax margin up to 22% vs. 21% in Q2’14 and 19% in Q3’14.
As for advisor headcount, Morgan Stanley had 16,162 registered reps as of Sept. 30, a slight drop from 16,316 in Q2’14 and 16,517 in Q3’13. Advisors have an average asset level of $124 million. Their average yearly production level (or fees and commissions) stands at $932,000 vs. $908,000 as of June 30 and $848,000 a year earlier.
Fee-based asset flows for the quarter were $6.5 billion, down nearly 50% from the prior quarter and almost 60% from last year. Securities-based lending, though, grew close to 50% from last year to $20.3 billion in Q3’14, while residential real estate loans improved roughly 60% year over year to $14.3 billion.
Morgan Stanley advisors’ fee-based assets of $768 billion represented about 38% of total client assets, which topped $2.0 trillion at quarter-end.