Merrill Edge assets cross $200B milestone
Merrill Edge, Bank of America’s investing service targeted to smaller-asset clients, has notched more than $200 billion in assets under management, according to the bank.
That figure is up 54% over the past three years, according to the company, and comes at a time when Bank of America has plans to further expand Merrill Edge’s reach.
The company intends to add 600 new investment centers within its existing bank branches by 2020. Bank of America also has plans to increase the number of advisors working for Merrill Edge by 300 to reach 4,000. By comparison, the company has more than 14,000 financial advisors working in its Merrill Lynch.
Bank of America has also introduced a redesigned mobile app, allowing users to trade stocks, ETFs, mutual funds and more. It also allows 100 free trades per month depending on the depth of the client relationship. The company’s robo advisor, Merrill Edge Guided Investing, is also part of its expansion plans.
Executives see a lot more runway for the bank’s Merrill Edge service. Dean Athanasia, president of small-business banking and co-head of consumer banking, said at an industry conference in June that only 15% of Bank of America customers currently use Merrill Edge.
Bank of America serves about 67 million consumer and small business clients, according to the company.
Of course, Bank of America isn’t the only company to expand its technology-enabled offerings aimed at smaller investors.
Fintechs are pitching new tools to plan providers claiming they can lower 401(k) costs.
Broker-dealers and financial advisors pay a steep penalty for failing to keep up with digital trends.
UBS has recently introduced a robo advisor and has plans to increase the number of advisors working at its call center by 25% to about 170. Wells Fargo and other competitors have also both introduced robo advisor offerings.
These and other moves occur against a backdrop of increased competition from robo advisor startups that target smaller investors with streamlined interfaces and low cost investments. Long established wealth management firms and banks are experimenting with a number of approaches to attracting such clients, such as JPMorgan Chase’s bid to introduce a mobile brokerage platform that includes free research and some free trading.
Traditional wealth management firms and banks have also looked to the startups for new talent in order to revamp existing operations. Morgan Stanley, for example, recently hired former Betterment Chief Marketing Officer Paul Halpern as head of deposits and banking services for the wirehouse’s Private Banking Group.