Unlocking Real Value Blog

Bank Of America Still Doesn’t Get It

The seemingly endless discussion of whether advisors at Merrill Lynch are benefiting from their marriage with Bank of America continues; the most recent war of words was sparked by Merrill Chief John Thiel, who defended the partnership after his predecessor made disparaging comments on the subject upon leaving the firm.

Bottom line? Band of America just doesn’t get it. Ever heard the expression perception is reality? Well, in this case the perception has been – and will likelihood continue to be – that the negatives of this relationship outweigh the positives – certainly from the perspective of many advisors who have always been loathe to be told what to sell.

This mentality among advisors is unlikely to change – so why fight it? I’m not saying that Merrill Lynch should stop trying to help advisors cross-sell so that they can deepen their client relationships. And I’m not saying that Merrill clients won’t benefit from the broad range of banking services that Bank of America offers. But management – why do you have to be so vocal about it? A little defensive, maybe? Why not just do what you are doing and allow advisors to utilize the services that they want when they want? If you build it they may come; if you force feed it they will not.

Advisors prize their independence, and the sanctity of the client relationship to many advisors is based on proving unbiased advise and services at all times. That’s not to say that many won’t use Bank of America banking products – they will if they feel that a particular offering is in their clients best interest and that the actions of the bank won’t cost them their client relationship. Anyone remember the $5 debit fee fiasco a few months ago?

The latest evidence of Merrill’s continued misreading of the situation was a Fundfire ( A Financial Times Service) survey last week. 41% of respondents (many presumably Merrill advisors) said that while the acquisition was good for the bank, it has not been good for the brokerage or advisors. This was the most popular answer. The second most popular answer, given by 30% or respondents, was the even more negative choice that the merger has proved bad for both parties, and is a bad fit with no lasting benefits. And just this week, Investment News reported that over the past three months, seven of the ten largest advisors moving firms left Merrill for greener pastures.

Hey John Thiel – stop talking about the benefits and let nature take its course. You can’t win this one in the press – win it quietly!

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