Veteran Merrill Lynch brokers have been leaving Bank of America Merrill Lynch and taking billions in assets elsewhere, and it's not just because they don'twant to drink wheatgrass shots and meditate.Insiders say that Bank of America is encouraging practices that hurt its brokers' business and relationship with clients.Bank of America wants "you to be an asset gatherer," one veteran Merrill broker said. "It seems like the banking side thinks it knows better than the broker dealer ... They want everyone to look the same, act the same, and wear pins the way Bank of America bankers do."Bank of America bought Merrill Lynch during the height of the financial crisis, and the marriage hasn't always been a happy one. Among themselves, brokers wonder whether Bank of America CEO Brian Moynihan cares for the brokerage business.Merrill brokers used to have an entrepreneurial spirit antithetical to the desire for uniformity that Bank of America allegedly champions. That dissonance is a large part of the reason why key teams are leaving the firm ' teams like Pennsylvania's Spanos Group, with $535 million under management, and Stephen Brown and James Goetz's $2.5 billion Pittsford, New York, team.Goetz and Brown say they were actually fired from Merrill for advising clients on the purchase of a hedge fund that wasn't on Merrill's platform."Alot of Merrill brokers leave to go to UBS, or go on their own, or maybe even to Morgan Stanley," the Merrill broker told Business Insider. "Old-line Merrill guys go to other players because it seems the bank side is taking over."And what the bank side wants isn't just control of what financial advisers are telling their clients to buy, the broker says, it's a new a distribution process that separates advisers from their clients. Brokers are "suggested" to direct clients with less than $250,000 assets under management to Merrill Lynch's call centers where young financial advisers are trained."You send them to the call center because you really don't have much of a choice," the broker said. "The client calls, and says, 'I came to work with you, not someone I don't know.' Then what do you say to them'"Another option available to Merrill brokers is to tell clients that they can manage their portfolios themselves through BAML's online Edge platform.To many brokers, all of this seems to be undermining their business, especially in parts of the US where $100,000 (for example) is a significant amount of money. Professional financial advisers welcome the challenge of growing that money with their client.It's Not Us; It's ThemPart of the problem is Bank of America CEO Brian Moynihan, who was an executive at Fleet Boston from 1999 to 2004 and didn't have the best history with brokerages. At Fleet he was integral in the high-profile acquisition of two brokerages ' Quick & Reilly and Robertson Stephens. Quick & Reilly morphed into something else entirely, and Robertson Stephens was closed down in 2003.This isn't just a Moynihan issue, though. In 1997, when most of what we know as Bank of America was Nationsbank, the bank bought Montgomery Securities, a firm brokers still remember for its top talent. By 2005 most of that talent had fled, and the remaining brokers were turned into private bankers."Bank of America is trying to 'Bankamericatise' Merrill Lynch, and the older guys are fed up," one former Bank of America banker said. "I suspect the US Trust private bankers are tired of all the nonsense. But Brian is running the show."OptionsNow it seems far less likely that Bank of America would get rid of a brokerage business. That's because since the financial crisis, wealth management has become a hot moneymaking business for Wall Street, taking the place of trading and investment banking in some cases.And Merrill brokers who want to leave the firm have a few options aside from big Wall Street banks like Morgan Stanley or UBS. The Spanos team, for example, went to Raymond James."In small towns like that it makes more sense to align with an Raymond James or an LPL Financial as opposed to going to the full independent platforms, as you get some home office administration and operations support," one Wall Street veteran said.Another option is to simply go it alone. These brokers may very well like it better that way.Bank of America has yet to respond to Business Insider's request for comment on this story.NOW WATCH:Here Are 5 Big Things Paul Krugman Says He Got Wrong Over The YearsOO.ready(function() { OO.Player.create('ooyalaplayer', 'x0aGdycTpUl73fcJMqgf_ScI93bAQMvH'); });Please enable Javascript to watch this videoJoin the conversation about this story
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