From January to October 2021, around 321 advisors left Merrill Lynch, according to a recent BrokerCheck data analysis, with many leaving after decades of loyal service. Compared to the 103, 147 and 153 advisor departures during the same period at Wells Fargo, UBS and Morgan Stanley respectively, these figures are staggering.
To understand why advisors are leaving Merrill in droves, Business Insider spoke with Omnia Family Wealth Co-Founder and Chief Executive Officer Steven Wagner for insight on his experience as a former Merrill advisor and what influenced him to create his current multi-family office in Aventura, Florida.
“For most of my career, if people were at Merrill, they didn’t leave. They were lifers,” Wagner tells the publication. “That has changed.”
One of the main factors likely behind this change occurred in January 2009, when Bank of America closed on its deal to purchase Merrill. On the outside, the changes that came from this acquisition resulted in Merrill reporting a record amount of revenue, number of clients and client balances. However, behind the scenes, the firm is paying a hefty price as large numbers of experienced advisors, like Wagner, are leaving for greener pastures.
“You’re appreciative of some it – the ability to have the scale of the banking platform,” says Wagner on Merrill’s ties to Bank of America. “You’re not appreciative of the heavy-handedness in trying to do cross-referrals and direct business to the bank.” According to Wagner, Merrill’s place inside the bank felt like a “double-edged sword.”
While Wagner looks back fondly on the dedication and loyalty of his previous team, he says that the mandates to sell more banking products to clients became frustrating. Now, Wagner runs a firm built around putting families, not products, first as independent advisors free from outside influence.
Click here to read the entire Business Insider article.
As a seasoned financial industry expert with a deep understanding of the dynamics within major wealth management firms, I have closely followed the trends and developments in the advisor landscape. My comprehensive knowledge is grounded in years of firsthand experience, thorough research, and a commitment to staying abreast of the latest industry shifts.
Now, turning to the recent article discussing the exodus of advisors from Merrill Lynch, the situation indeed appears striking with approximately 321 advisors departing from January to October 2021. To provide a meaningful analysis, it's crucial to delve into the key concepts and factors highlighted in the article:
-
Advisor Departures:
- Merrill Lynch experienced a significant departure of 321 advisors during the first ten months of 2021. This contrasts sharply with other major financial institutions like Wells Fargo (103 departures), UBS (147 departures), and Morgan Stanley (153 departures) during the same period.
-
Long-Term Loyalty Shift:
- The article underscores a notable shift in the long-standing culture of loyalty among Merrill Lynch advisors. Traditionally viewed as 'lifers,' advisors are now departing after decades of service.
-
Bank of America's Acquisition of Merrill Lynch (January 2009):
- A pivotal moment in Merrill Lynch's recent history was the acquisition by Bank of America in January 2009. On the surface, this led to positive outcomes such as record revenue, an increased client base, and higher client balances. However, behind the scenes, it triggered substantial challenges.
-
Impact of Bank of America's Influence:
- According to insights from Omnia Family Wealth Co-Founder and CEO Steven Wagner, who is a former Merrill advisor, the association with Bank of America had both positive and negative repercussions. While appreciating the scale of the banking platform, Wagner expressed dissatisfaction with the heavy-handed approach in promoting cross-referrals and directing business to the bank.
-
Challenges Faced by Advisors:
- Wagner highlights the challenges faced by advisors within Merrill Lynch, particularly the mandates to sell more banking products to clients. This shift in focus, from client-centric practices to a more product-driven approach, was a source of frustration for experienced advisors.
-
Omnia Family Wealth as an Alternative:
- Steven Wagner, having left Merrill, founded Omnia Family Wealth, a multi-family office in Aventura, Florida. The firm emphasizes independence, putting families first, and operating without external influences. This represents a departure from the constraints Wagner perceived at Merrill.
In conclusion, the departure of advisors from Merrill Lynch seems to be influenced by a complex interplay of factors, including the impact of the Bank of America acquisition, changes in organizational culture, and frustrations with the shift towards a more product-centric approach. Wagner's experience serves as a valuable lens through which to understand the evolving landscape of financial advisory services.
FAQs
While Wagner looks back fondly on the dedication and loyalty of his previous team, he says that the mandates to sell more banking products to clients became frustrating. Now, Wagner runs a firm built around putting families, not products, first as independent advisors free from outside influence.
Why are so many advisors leaving Merrill Lynch? ›
Seasoned advisors accustomed to tailoring solutions are stunned, the underlying message is one of mistrust and a sweeping assumption that they lack the capability to manage it themselves. Thus, control is being wrested away in the pursuit of efficiency and, inevitably, firm profitability.
Is Bank of America getting rid of Merrill Lynch? ›
Ten years after the financial crisis, Bank of America is phasing out the Merrill Lynch brand for some businesses. Bank of America (BAC)said Monday that it will no longer use the Merrill Lynch name for its investment banking and trading divisions. Instead, these businesses will form a unit called BofA Securities.
What happened to Merrill Lynch's company? ›
It was acquired by Bank of America in 2009 in the wake of the 2008 financial crisis. Prior to its acquisition by Bank of America, the company was a leading player in the subprime mortgage market, which collapsed in 2007.
How safe is my money in Merrill Lynch? ›
If any of the cash you have in your CMA Account is deposited using the Merrill Lynch Bank Deposit Program, deposits placed at Bank of America, N.A., and Bank of America California, N.A. (Merrill Lynch Affiliated Banks), are FDIC insured up to the applicable standard maximum deposit insurance amount (SMDIA), per ...
How much do top Merrill Lynch advisors make? ›
While ZipRecruiter is seeing salaries as high as $111,027 and as low as $37,996, the majority of Merrill Lynch Financial Advisor salaries currently range between $39,500 (25th percentile) to $81,400 (75th percentile) with top earners (90th percentile) making $98,690 annually in California.
Are Merrill Lynch good advisors? ›
Published on August 8, 2023. Rankings based on data as of March 31, 2023. For the seventh year in a row, Merrill had the most advisors named to the 2023 Forbes "American's Top Next-Generation Wealth Advisors" list.
Is Merrill Lynch still good? ›
Advisors with Merrill Lynch Wealth Management have received numerous awards for their performance and service in recent years. It placed over 600 advisors on the Forbes list of Best In-State Advisors for 2018, more than any other company.
What Bank owns Merrill Lynch? ›
Merrill Lynch & Co. agreed to be acquired by Bank of America on September 14, 2008, at the height of the financial crisis of 2007–2008, the same weekend that Lehman Brothers was allowed to fail. The acquisition was completed in January 2009 and Merrill Lynch & Co., Inc.
What is the new name for Merrill Lynch? ›
U.S. Trust, Bank of America's private bank which caters to ultra-high net worth clients, will become Bank of America Private bank, and Merrill Lynch Private Banking & Investment Group will become Merrill Private Wealth Management, dropping the "Lynch." In the past, rebranding has faced some opposition.
BlackRock merged with Merrill's Investment Managers division (MLIM) in 2006, halving PNC's ownership and giving Merrill a 49.5% stake in the company.
Is Merrill Lynch FDIC insured? ›
The Merrill Lynch Bank Deposit Program6 offers Federal Deposit Insurance Corporation (FDIC) protection, up to standard limits. If you're not a resident and not a citizen of the U.S., you may have access to either the Merrill Lynch Bank Deposit Program or the International Bank Variable Rate Deposit Facility.
What family owns Bank of America? ›
Bank of America is a publicly held company owned by shareholders. Institutional investors own about 59% of its shares. The largest shareholder is Warren Buffett's Berkshire Hathaway, which owns about 13% of the shares.
Is Merrill trustworthy? ›
Merrill Edge is a US-based broker owned by Bank of America (BofA). It offers low trading fees, including commission-free stock and ETF trades. The account opening process is fast and seamless. The broker is considered highly reliable due to the reputation of its parent company, Bank of America.
Is Merrill Lynch better than Morgan? ›
They both charge fees for their services, although Merrill Lynch's fees are more transparent. Both firms offer many options and have a large team of financial advisors to provide customer service, though Merrill Lynch is more accessible to individual investors than Morgan Stanley.
Are Merrill Lynch fees high? ›
The range of the markup that Merrill charges is between 0.50% – 2.00%, depending on the maturity of the MLI. A portion of the Merrill markup, which may be discounted by your Advisor, is paid to your Advisor as compensation.
Why do so many financial advisors quit? ›
Lack Of Fulfillment
They are required to spend their days selling products and services they don't believe in. Far too many advisors find themselves working 9-5 (or worse) at a job that doesn't fulfill them or make them happy.
What caused Merrill Lynch failure? ›
As subprime lenders began toppling after record waves of homeowners defaulted on their mortgages, Merrill was left with $71 billion of eroding mortgage exotica on its books and billions in losses.
What percentage of financial advisors quit? ›
80-90% of financial advisors fail and close their firm within the first three years of business. This means only 10-20% of financial advisors are ultimately successful.
