Merrill growing the herd with training program

Revamped structure already seen paying off; 'core to our strategy'

Nov 9, 2012 @ 4:48 pm

By Andrew Osterland

Merrill Lynch
+ Zoom
((Photo: Bloomberg News))

Merrill Lynch's famed training program served as the proving ground for thousands of financial advisers both inside and outside the brokerage over the decades.

The financial crisis temporarily took its toll on the effort, but the brokerage has since revamped its Practice Management Development (PMD) program, according to Dwight Mathis, head of business development and new advisor strategy at Merrill Lynch Wealth Management.

“Training has been core to our strategy since 1947, so it's nothing new,” said Mr. Mathis who participated in the InvestmentNews NextGen Virtual Career Fair. “We revamped the structure of our PMD program 18 months ago.”

There are currently 4,300 people at various stages of the three and a half year program and Merrill plans to hire 2,500 this year alone. About 80% of the company's wealth management business is generated by advisers who started in the training program. “We'll hire more new financial advisers this year than all our competitors combined,” said Mr. Mathis.

Trainees, who are developing a book of business as they train, are paid a salary during the 43 month program, and commissions and bonuses based on their productivity. They have mentors and are encouraged to join or form a team during the first few years. Merrill also has PMD program managers focused on and compensated based on the success of trainees.

The program has three stages beginning with sales training, coaching and the start of a structured licensing process. Stage two focuses on the optimal practice model and the final stage — the PMD Passport stage — deals with mental and physical health and wellness. Trainees are expected to meet quarterly hurdles and Mr. Mathis said that 65% of current trainees are hitting their targets.

Mr. Mathis said the company's growth strategy depends on three pillars in the following order of importance: Helping the company's more than 17,000 financial advisers grow their business; developing new financial advisers; and recruiting advisers from rival. “If we can develop the best financial advisers, we can put blue sky between us and our competition,” he said.

0
Comments

What do you think?

View comments

Recommended for you

Latest news & opinion

The appeal and pitfalls of holding unconventional assets in retirement accounts

While non-traditional asset classes held in individual retirement accounts may have return and portfolio diversification benefits, there are "unique complexities" that limit their value for most investors.

New Jersey fines David Lerner Associates for nontraded REIT sales

Firm will pay $650,000 for suitability, compliance and books and records violations.

Report predicts $400 trillion retirement savings gap by 2050

Shortfall driven by longer life spans and disappointing investment returns.

Wells Fargo will ramp up spending to lure brokers

Wirehouse, after losing 400 brokers in first quarter, is bucking trend among rivals who have said they are going to cut back on spending big bucks recruiting veteran advisers

DOL fiduciary rule pushes indexed annuity carriers to develop new products

Insurers are introducing fixed-rate deferred annuities with income guarantees to circumvent BICE.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print