Bank of America Corp. is looking to largely wrap up its local integration of Merrill Lynch by August.
That’s about a month earlier than previously targeted, according to Greg Mech, Bank of America’s Orange County market president who also heads up its financial advisory services operations across Southern California.
“The trend is clearly moving toward universal banking and wealth management services,” he said. “Most of the other major players are headed in that direction. But we feel like we’ve got a head start and are putting a lot of effort into integrating both companies in Orange County and across Southern California.”
The combined wealth management operation, which is set to go by Merrill Lynch Wealth Management, is expected to wind up with nine offices in the county, Mech said.
Before the deal, Merrill Lynch had nine local offices.
Bank of America’s early 2009 buy of Merrill Lynch & Co. turned a couple of big names in OC into the dominant local player in wealth management.
Merrill Lynch recently surpassed $25 billion in local money under management, according to Mech.
Mech, who hails from the Merrill Lynch side, credited much of the growth to a more than 20% boost in local financial advisers to 241.
Most of those gained came from Bank of America, which put its wealth management operations under newly acquired Merrill Lynch.
Some of the added wealth advisers were drawn from rivals because of the combined operation’s range of services, Mech said.
“The combination of Bank of America and Merrill Lynch certainly opens some new opportunities for us to work with clients in more comprehensive ways,” he said.
Precise market share numbers in local wealth management are hard to come by. Merrill Lynch is widely viewed as the dominant player, followed by Morgan Stanley Smith Barney LLC, Wells Fargo & Co., JPMorgan Chase & Co. and UBS Financial Services Inc.
“Merrill Lynch has been top dog in OC’s brokerage and advising community for years,” said Jerry Slusiewicz, president at Pacific Financial Planners LLC. in Laguna Hills. “Tapping into BofA’s customer base is going to be a gold mine for them. It’s going to raise the stakes for everyone in the money management game around here.”
Bank of America is looking to turn banking customers into investment clients and vice versa.
The deal “provides a combination of resources that puts our advisers in an advantageous position to handle all types of corporate and individual wealth management situations,” Mech said.
He points to the case of a company executive who was a Merrill client and wanted to arrange a $300 million line of credit to make an acquisition for his company.
“The financial adviser took the role of quarterback, collaborating with the lending, trust and investment banking sides,” Mech said. “The adviser was able to integrate all of the various services available and come up with a way for the client to complete the deal.”
Since the acquisition, some 275,000 referrals have been given nationwide to Merrill Lynch advisers, according to Bank of America.
How much cross-marketing has taken place in the county isn’t clear. Cooperation and pooling of resources are being encouraged on the local level, according to Mech.
Private Banking
A key focus is going to be expansion of Merrill Lynch’s private banking and investment group, which requires at least $10 million in account size, according to bank managers.
The average private investment client in OC has an account of around $40 million, said Michael Rogers, the group’s regional director based in Century City.
In the county, some 12 advisers are part of the private banking team, Rogers said. Another 40 advisers are part of the team scattered throughout Southern California. Limits are put on the number of accounts each can handle, he said.
“We see a special need in OC to prepare high-tech and healthcare executives, in particular, for generational wealth transfer,” he said. “One of our most important objectives is not just to manage money but to keep it on a long-term basis.”
Increasingly, that involves working with entire families to educate them about their financial futures, according to Rogers.
“We’ll continue to be interested in adding more advisers in OC who are experienced dealing with families and their special needs,” he said. “That’s the sort of expertise that will be in great demand as the county and our wealth advisement services continue to grow with our greater breadth of services in wealth management.”
