BofA creates new retirement unit

Retirement and Personal Wealth Solutions combines institutional, personal-retirement and preferred-segment-solutions teams.

Jul 23, 2013 @ 3:07 pm

By Darla Mercado

+ Zoom

Bank of America Corp. has combined its retirement planning and wealth management capabilities.

In an internal memo sent out last Friday, the firm announced that it would pull together its institutional, personal-retirement and preferred-segment-solutions teams. The new entity will be called Retirement and Personal Wealth Solutions, Andy Sieg, head of global wealth and retirement solutions, wrote in the memo.

Accordingly, the bank also shuffled executives to come up with a roster that will lead the new group.

David Tyrie, formerly managing director and head of personal wealth and retirement at Bank of America Merrill Lynch, will lead Retirement and Personal Wealth Solutions. A Putnam Investments alumnus and veteran of the 401(k) space, Mr. Tyrie has been with Bank of America Merrill Lynch since 2010.

Kevin Crain, previously head of institutional-retirement and benefit services at Bank of America Merrill Lynch, will move to a newly created role as a senior relationship executive. He will interact with the largest retirement and benefit plan clients. In this new capacity, Mr. Crain will also be front and center in Washington, acting as an advocate for the 401(k) industry.

Tom Halloran, head of the preferred-segment-solutions team, will continue in his role, as his team has been folded into Retirement and Personal Wealth Solutions.

Finally, the retirement and benefits services leadership team will remain as is, albeit with expanded duties:

Steve Ulian, mega and large market sales and relationship management executive, has added health benefit solutions, global institutional consulting and consultant relations to his team's duties.

The team working with Joe Mrozek, who oversees small- and middle-market sales and acts as a sales support executive, will also handle internal sales support functions.

Rick Irace, an integrated-benefit-solutions executive, and his team will continue to work on the management of institutional and small business product platforms.

All of these executives will report to Mr. Tyrie.

The new arrangement creates a continuum of care for clients, starting when they are in a BAML retirement plan and continuing into retirement with access to wealth management services.

“The magic formula is this relationship with the customer while they're with a retirement plan — you build trust, there is an interest to stay with you,” said Mr. Tyrie. “We have a field force of 15,000-plus advisers who are serving individual clients and if a participant chooses to work with an adviser, we can get them there.”

Savers who choose to do it themselves can also use the Merrill Lynch platform, Mr. Tyrie added.

“You have this massive group of people moving to retirement, and it's built on this initial stage of retirement; there is no guidance for this second stage,” Mr. Tyrie said. “The industry should adopt the strategy of to and through retirement. That's what customers want.”

The decision to combine the retirement planning and wealth management services could bode well for the firm's IRA rollover business, according to Jason C. Roberts, chief executive officer of Pension Resource Institute.

“This looks to be a good strategy to leverage Merrill's retirement plan presence with personal retirement opportunities on the wealth management side,” he said.

Though only a handful of the firm's top plan advisers can provide advice to clients, most of the plans are handled by brokers who don't act as a fiduciary.

”This leaves those reps free to solicit IRA rollovers and other cross-selling opportunities,” Mr. Roberts added.

Bank of America Merrill Lynch's retirement business has been on an upswing in recent years. The firm oversees $580 billion in client assets as of June 30.

The firm's institutional retirement and benefit plan businesses added more than $75 billion in new plan assets from 2010 through June 30 of this year. Clients have also been flocking to the firm, as the company picked up nearly 6,000 new retirement plans in 2012, up 8% from 2011.

News of the memos was initially reported by GatekeeperIQ.

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