Merrill Lynch Canada and its homegrown competitor Nesbitt Burns are racing to see which firm can deliver more online services first.
Merrill, which this past summer unveiled unlimited online trading to fee and discount customers in the United States, says it intends to offer Internet trading and other online services to its full-service Canadian customers. (Merrill is not starting an online discounter in Canada.) No timetable has been announced, but sources say Merrill may have to accelerate its plans to meet a challenge from Nesbitt Burns.
Nesbitt, the Bank of Montreal's full-service brokerage unit, is set to phase in online services for its private client group. "The market for this is gigantic," says Gilles Ouellette, head of Nesbitt's private client group.
The Nesbitt program targets investors with a minimum portfolio of 100,000 dollars. It enables advisers' clients to trade over the Internet. This month, the firm will begin to post proprietary stock and fund research. By June, the firm plans to offer customers the ability to trade equities, options and funds online.
Nesbitt customers will pay a minimum 1,500 dollars annual fee, with fees tied to portfolio size. Merrill Lynch Canada, which already offers private clien ts online Canadian research, will add international research this month. And executives at competing firms say Merrill feels pressure to move quickly into online trading.
"Merrill is already battling to hold on to customers against inroads by Schwab and TD Waterhouse," says a senior marketing executive at a competitor in Toronto. "They cannot let a full-service competitor get ahead of them now."