Separate BofA Retention Package Targets Top Half of BofA force

Bank of America and Merrill Lynch released retention bonus plans for their financial advisors on Friday and both send a consistent message to financial advisors: If you’re a top producer, we want you to stay. (Click here for the Merrill retention package.) If you’re not, see ya.

Bank of America and Merrill Lynch released retention bonus plans for their financial advisors on Friday and both send a consistent message to financial advisors: If you’re a top producer, we want you to stay. (Click here for the Merrill retention package.) If you’re not, see ya.

If Merrill Lynch’s plan focused on its top FAs, Bank of America’s package, for its own advisors, does so even more. Only 50 percent, or roughly 1,000 of the 2,000 Banc of America Investment Services FAs, will see a retention bonus, according to firm spokesman Jerry Dubrowsk. “A lot of planning went into this plan,” he said. “And at the end of the day, we wanted it to be fair but to also reward those FAs that consistently delivered value to their clients.” Dubrowski added that retaining the top FAs at both firms represents “the lynchpins” of the deal, and was key to growing the combined wealth management business.

The calculation for the bonus isn’t based on the traditional “trailing 12-month production” metric that Merrill and other brokerage firms typically use. Instead, eligibility for the bonus is based an annualized number—the FA’s previous 6-months production times two. (The six-month period ends from June 1 through Aug. 31st.)

According to the spokesman, if the result of that calculation is $350,000 or greater, the FA will get a retention bonus, paid in the form of a 3-year deferred cash deal with the first payment made to the FA on the day the BAC/Merrill Lynch deal closes and the following two payments made on the anniversary of that date.

Below is how the bonus breaks down for the rest of the eligible Banc of America Investment Services’ FAs.

If an FA’s trailing 6-month production (times 2) is:

· $2 million or above, the retention bonus is 50 percent, paid in a 3-year deferred cash bonus;
· $900K—$1.99m, the retention bonus is 40 percent;
· $600K—$899K, the retention bonus is 30 percent;
· $350K—$599K, the retention bonus is 20 percent.

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