In a move contrary to its fiercest competitors, Merrill Lynch will remain in the broker protocol for recruiting agreement.
Merrill's head of wealth management, Andy Sieg, made that intention clear on a call with senior management Monday morning, according to a person familiar with Mr. Sieg's comments.
Mr. Sieg said that while Merrill Lynch is continuously evaluating the competition, it is not currently making plans to leave the protocol, according to that source, who asked not to be named.
The protocol was established in 2004 by a handful of large firms but picked up by many smaller ones. It opened the floodgates for brokers to move from firm to firm, often lured by big signing bonuses.
UBS followed the lead of Morgan Stanley, which told its employees at the end of October it would no longer work under the protocol.
Many industry observers widely anticipated that Merrill Lynch would be the next firm to tear up the protocol.
Mr. Sieg said that while other firms are focused on leaving the protocol as a way of retaining advisors and clients, Merrill Lynch would stay focused on making sure that advisers have what they need to serve clients and grow businesses, according to the Merrill Lynch source.
Mr. Sieg also said that Merrill Lynch wants its advisers to focus on helping clients achieve financial goals acquiring new client relationships.
The protocol allows an adviser to take a limited amount of client information when leaving a firm for a new shop, and essentially eases that transition. It prevents lawsuits and restraining orders that harm clients, and has been widely accepted, with more than 1,500 firms working under its rules.