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10. Merrill Edge Guided Investing

Practice Management > Building Your Business > Recruiting

Top 5 Q3 Trends at Merrill Wealth Management

By Jeff Berman

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Bank of America’s Merrill Lynch Wealth Management division had a mostly strong third quarter ended Sept. 30 that, in a Monday conference call with reporters, Andy Sieg, the division’s president, largely credited to the performance of the firm’s advisors during a quarter of strong recruiting results.

Overall, BofA reported revenue, net of interest expense, increased 8% to $24.5 billion, while profit fell to $7.1 billion from $7.7 billion a year ago.

Income in the Global Wealth and Investment Management division, which includes Merrill Lynch Wealth Management, was flat at $1.2 billion. But revenue grew 2% to $5.4 billion.

The firm reported wealth management client balances of $3.2 trillion, down 12% from a year ago, “driven by lower market valuations, partially offset by net client flows,” it said in an earnings news release.

Merrill Lynch and BofA Private Bank combined added over 5,700 net new client relationships in Q3, Sieg said on the call. The quarter ended with assets under management of $1.3 trillion.

The firm, meanwhile, ended Q3 with 18,841 advisors across the wealth management divisions, Sieg said.

Here are the top five trends in Merrill wealth management based on the Q3 results and executive commentary.

1. Recruiting was strong in the quarter.

The firm reported having 18,841 advisors at the end of Q3, up from the 18,500 it reported for the second quarter. Previously, the firm had seen advisory staff shrinkage in every quarter since Q3 of 2021 as it prepared to start a revamped, 18-month advisor training program.

Q3 was the firm’s best quarter ever in terms of attracting experienced advisors, according to Sieg.

2. More clients are remaining with the firm even if their advisors leave.

When advisors leave BofA Private Bank and Merrill Lynch for other firms, the company is seeing a growing number of their clients staying with the firm, Sieg told reporters. About 50% of their clients are now being retained by the company, he said, noting that’s an increase of more than 10 percentage points from where the company was two years ago.

3. A growing number of Merrill advisors are CFPs.

Almost 4,000 of the 18,841 advisors hold the certified financial planner designation, the company pointed out.

4. The firm continues to enhance its digital offerings for advisors and clients.

The firm’s recently launched Merrill Advisor Match digital platform was introduced in the quarter, modernizing the process of finding an advisor for prospective clients. There are now 5,500 advisors enrolled in that offering, the company said.

Meanwhile, the company’s Collaborative Onboarding Experience, launched last year, is providing a fully digitized client account opening experience and about 33% of all eligible accounts were opened digitally in Q3, it said.

The company’s Mobile Advisor Experience (MAX), launched in 2021, gives advisors access to a full range of workstation features while they are on the go, the company said, noting it’s been used almost 1 million times so far in 2022.

Also, 80% of Merrill households are now digitally active across the enterprise, while 375,000 households exchanged about 1.3 million secure messages in Q3 and a record 77% households were enrolled in eDelivery.

Meanwhile, in BofA Private Bank, 86% of clients were digitally active across the enterprise in Q3, the firm said. Clients are increasingly leveraging the company’s digital capabilities, it said, reporting record Erica AI interactions, up 62% from a year earlier; record Zelle transactions, up 41%; and record digital wallet transactions, up 63%.

5. Diversity is improving among advisor trainees.

It was “still early” and too soon to say what the success rate will be of the firm’s revamped advisor training program, Sieg said in response to a ThinkAdvisor question. There’s another six months to go before the initial recruits complete the program, he noted.

But minority representation is up. Forty-five percent of the new recruits are “people of color,” Sieg said.

(Image: Shutterstock) 

Jeff Berman

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