Q&A with Sallie Krawcheck: Why the behemoth brokerages will prevail
Sallie Krawcheck has been president of Bank of America Corp.'s global wealth and investment management unit for less than three months, but, as usual, she is already making news
Sallie Krawcheck has been president of Bank of America Corp.’s global wealth and investment management unit for less than three months, but, as usual, she is already making news. In the past two weeks alone, she has generated headlines: unveiling her new management team at Merrill Lynch & Co. Inc., announcing a new $20 million marketing campaign for
Merrill and being mentioned as a possible successor to Ken Lewis as BofA’s chief executive.
For good measure, after proclaiming “The bull is back!” at a press conference last week, she took a shot at independent advisory firms, which, she maintained, are losing clients in part because they “don’t have the vast depth of capabilities and resources” of a large financial services corporation.
Q. Being a Merrill Lynch broker hasn’t been easy this past year. What are you doing to retain good brokers?
A. The best thing we can be doing for our advisers and their clients is to invest into the business. We have already brought the capabilities of Bank of America to Merrill Lynch with very good success. And we’ve made investments in stand-alone technology, performance reporting and a new website, which clients tell us they highly value. When financial advisers across the industry catch their breath, I think they’re going to see that Merrill clients are the ones who are better off.
Q. Your brokers have gone from being part of the proud “Thundering Herd” to being part of one of the country’s largest banks. Has there been a culture clash, and how are Merrill brokers adjusting?
A. Our financial advisers have the same managers, the same brand and the same capabilities — in fact, they have more capabilities. And the brand is receiving more support than it ever has. Financial advisers have not been turned into tellers.
Q. At your press conference last week, you talked about impressive numbers of new advisers joining the firm. Where are they coming from?
A. The new financial advisers are trainees. Merrill has a very long and successful history of growing their own. It’s been a strength and a very important part of the Merrill Lynch culture.
Q. Citigroup announced last week that it is converting its branch network brokers to a fee-only advisory model. Do you see Merrill Lynch moving in a more fee-oriented direction?
A. The entire business has been shifting to a more fee-oriented model for a number of years — that’s a secular trend that’s occurring across the board. Merrill Lynch wants to make sure clients have an informed choice about how they interact with advisers and what the compensation will be.
To read the rest of this exclusive interview, please see the Oct. 12 issue of InvestmentNews
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