Bank of America's Moynihan: No quick pullback from fiduciary rule

Chairman and CEO of the bank that contains Merrill Lynch says the DOL regulation is part of a larger trend in financial services.
JUL 18, 2017
Bank of America Corp's chairman and CEO, Brian Moynihan, does not see a quick pullback from the Department of Labor's fiduciary rule. The bank's global wealth and investment management group, which contains Merrill Lynch Wealth Management, last year said it was eliminating commissions from advised brokerage IRAs, sending a shock through the investment advice industry. The goal of the rule is to eliminate potential conflicts brokers face when recommending one product to clients rather than another. The November election of Donald J. Trump was widely seen as an opening for the repeal of the fiduciary rule, along with a number of provisions from the 2010 Dodd-Frank Act. During a conference call Tuesday morning with investors to discuss second quarter results, Mr. Moynihan was asked whether the fiduciary rule could be repealed. He responded: "Let's see what happens. I don't think it's going to change our thinking." He added that the DOL fiduciary rule was part of a larger trend in financial services that is bringing prices down for consumers. Meanwhile, the number of Merrill Lynch advisers increased 1.8% to 14,811 at the end of June compared to the previous quarter, a net addition of 254 for the three months. And Merrill Lynch will look to continue to expand the brokers and advisers under its roof, he said. "We have a tremendous customer base that is underserved in the investment management area. We are going to continue to grow" the number of advisers, Mr. Moynihan said. "You should expect that number to continue to go up." Growth in the number of advisers came despite Merrill Lynch recently losing highly productive financial advisers. In May, Merrill Lynch, along with rival Morgan Stanley, said it was reducing its reliance on recruiting experienced advisers and putting renewed focus on training younger advisers and building staff. Global wealth and investment management also reported a record $804 million of net income, an increase of 14% when compared to the same quarter a year earlier.

Latest News

No succession plan? No worries. Just practice in place
No succession plan? No worries. Just practice in place

While industry statistics pointing to a succession crisis can cause alarm, advisor-owners should be free to consider a middle path between staying solo and catching the surging wave of M&A.

Research highlights growing need for personalized retirement solutions as investors age
Research highlights growing need for personalized retirement solutions as investors age

New joint research by T. Rowe Price, MIT, and Stanford University finds more diverse asset allocations among older participants.

Advisor moves: RIA Farther hails Q2 recruiting record, Raymond James nabs $300M team from Edward Jones
Advisor moves: RIA Farther hails Q2 recruiting record, Raymond James nabs $300M team from Edward Jones

With its asset pipeline bursting past $13 billion, Farther is looking to build more momentum with three new managing directors.

Insured Retirement Institute urges Labor Department to retain annuity safe harbor
Insured Retirement Institute urges Labor Department to retain annuity safe harbor

A Department of Labor proposal to scrap a regulatory provision under ERISA could create uncertainty for fiduciaries, the trade association argues.

LPL Financial sticking to its guns with retaining 90% of Commonwealth's financial advisors
LPL Financial sticking to its guns with retaining 90% of Commonwealth's financial advisors

"We continue to feel confident about our ability to capture 90%," LPL CEO Rich Steinmeier told analysts during the firm's 2nd quarter earnings call.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.