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The New Merrill Mantra: We Want Brokers, Brokers, Brokers
The brokerage firm’s head of recruiting outlined the firm’s strategy for attracting rookie reps and veteran brokers just days after Sallie Krawcheck assumed her new post atop the Thundering Herd.
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In a teleconference with external recruiters August 10, the first such confab since midwinter, Merrill recruiting head Don Geisler outlined the specific details of Merrill’sstrategy to attract new talent and expand its brokerage force.
It’s a plan that involves luring young and relatively inexperienced advisors all the way up the chain to top veteran brokers. Recruiters who participated in the call noted that Geisler’s message—which was delivered just days after Krawcheck assumed her new post—was loud and clear.
“We want brokers, brokers, brokers,” said one recruiter, who declined to speak for attribution, when summing up Geisler’s call.
For top producers who generate in the range of $800,000 or more in fees and commissions per year, Merrill is offering one of the most competitive packages on Wall Street, said another recruiter on the call, who also asked not to be identified.
The deal starts with an upfront bonus of 140 percent of the broker’s previous year’s fees and commissions.
A broker can add to that each year for the next five years and receive a bonus based on a percentage of assets the broker delivers. In the first year, the broker must bring 65 percent of his assets to Merrill from the prior firm to qualify.
By year five, the broker needs to increase those assets to a level of 1.5 times what he or she had with the prior firm to get the bonus, the second recruiter said.
And this comes as New York-based Merrill Lynch & Co. Inc., which was acquired by Bank of America Corp. of Charlotte, North Carolina, at the end of last year, is reopening its training program for brokers.
In addition to the reps generating $800,000 or more in fees and commissions, Merrill is targeting brokers who range from the first to the third “quintile,” or the top 20 percent to 60 percent, in production, recruiters said.
“Merrill is giving recognition to the fact that there are phenomenal brokers whose numbers are off because of the market,” the second recruiter said.
The firm is also looking to hire potential rising stars, the recruiters said. That would include a broker with a couple of years’ experience who annually generates $200,000 or more in fees and commissions.
Just last week, Bank of America CEO Kenneth Lewis tapped Krawcheck to replace Dan Sontag and run the bank’s global wealth and investment management sector.
With the historic collapse and the credit crisis that wiped out a number of storied investment firms, Merrill clearly has lost its foothold as the biggest retail brokerage firm on Wall Street.
Merrill’s reputation as the world’s largest brokerage army has been eclipsed by New York-based Morgan Stanley, which this year formed a majority-owned joint venture with Smith Barney—Krawcheck’s former firm—that gives it about 18,445 advisors around the world and client assets of $1.4 trillion.
At the end of June, Merrill had about $1.2 trillion of client assets and 13,000 legacy financial advisors (excluding about 2,000 Bank of America brokers who had adopted the Merrill brand), down from almost 16,100 six months earlier.
Merrill Lynch spokeswoman Selena Morris said the firm wouldn’t comment on a conference call. She added: “As always, recruiting and retaining quality advisors is a top priority for Merrill Lynch wealth management.”
Filed by Bruce Kelly ofInvestment News, a sister publication of Workforce Management. To comment, e-mail [email protected]
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