Is Merrill Lynch's Thundering Herd On The Move As BofA Grinds?

Tuesday, August 30, 2011 07:59
Is Merrill Lynch's Thundering Herd On The Move As BofA Grinds?

Tags: breakaway brokers

The ongoing tribulations of Bank of America has Merrill advisors feeling like they are holding up a damaged banking franchise, and recruiters say many are considering offers to go elsewhere.

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New layoffs and the frankly dismal performance of BAC stock have the thundering herd demoralized and disincentivized to boot, according to the recruiters trying to woo them away. 


Since BAC shares are down 37% year to date, that dramatically weakens the strength of the golden handcuffs -- stock-heavy retention and bonus packages -- to keep Merrill advisors from straying.


And while Wall Street itself considers Merrill too big and too successful to fail, analysts question why one of the world's most profitable brokerage firms should remain strapped to what looks like a deeply troubled banking franchise.


There are rumors that JPMorgan may want to buy the firm -- which might raise antitrust issues if the government considers the wirehouse channel its own business -- or that BofA will have to dump it to raise cash.


In the meantime, the advisors themselves are on the go, or at least considering it.


UBS just grabbed a trio that produces a huge $2.8 million a year, while Raymond James picked up a somewhat more ground-level father-and-son team a few weeks back.

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