On a nationwide conference call this morning with branch managers and regional directors, Robert McCann, president of Merrill’s global private client group, told them that they will not be getting anything in the way of retention. He also told them that the retention package for financial advisors would be released in the next week or two, and that only some financial advisors would get a deal.
“He said ‘there’s no plans to give managers anything,’” one manager told Registered Rep.. As for financial advisors, he said, “‘we’re going to build a wall around the top two-thirds of production,” the manager says. A Merrill Lynch spokesperson had no comment.
The manager described McCann’s tone on the call as “arrogant”—but another manager said it was more “McCann’s matter-of-fact way of speaking.”
Regardless, plenty of managers are angry at the news. Managers at all the firms have lost a lot money in the past 12 months. At Merrill, managers receive 40 percent of their compensation in stock. At one time—when the stock was trading for around $70—this was a great thing. But most Merrill stock options are under water now. And the all-stock deal with Bank of America, which gives Merrill shareholders 0.86 BofA shares for each Merrill share, offers little solace for those who have lost hundreds of thousands of dollars in net worth.
Still, for some managers, if the news was disappointing, it wasn’t unexpected. “Especially given the environment, anyone who thought we’d get anything was delusional. Sure, a lot of the managers and directors were top producers before, so we feel we’re at least as valuable as our FAs. But look, when you go into leadership that’s a sacrifice you make,” said one branch manager.
He says he’s staying put for now: “It isn’t clear at all where I would go. The other firms are crumbling as we speak,” he says.
Still others think McCann is gambling with the very people who lead his herd of FAs and that it could cost him: “Bob McCann has effectively lost the field with this news,” says one manager.