The new Merrill mantra: We want brokers, brokers, brokers

As Sallie Krawcheck takes charge of Merrill Lynch's retail-brokerage firm, it is priming the pump to recruit reps of all stripes — not just the jumbo producers so coveted on Wall Street.

As Sallie Krawcheck takes charge of Merrill Lynch’s retail-brokerage firm, it is priming the pump to recruit reps of all stripes — not just the jumbo producers so coveted on Wall Street.

In a teleconference with external recruiters this Monday, the first such confab since midwinter, Merrill recruiting head Don Geisler outlined the specific details of Merrill’s strategy to attract new talent and expand its brokerage force.

It’s a plan that involves luring young and relatively inexperienced advisers all the way up the chain to top veteran brokers. Recruiters who participated in the call noted that Mr. Geisler’s message — which was delivered just days after Ms. Krawcheck assumed her new post — was loud and clear.

“We want brokers, brokers, brokers,” said one recruiter, who declined to speak for attribution, when summing up Mr. Geisler’s call.

For top producers who generate in the range of $800,000 or more in fees and commissions per year, Merrill is offering one of the most competitive packages on Wall Street, said another recruiter on the call, who also asked not to be identified.

The deal starts with an upfront bonus of 140% of the broker’s previous year’s fees and commissions.

A broker can add to that each year for the next five years and receive a bonus based on a percentage of assets the broker delivers. In the first year, the broker must bring 65% of his assets to Merrill from the prior firm to qualify.

By year five, the broker needs to increase those assets to a level of 1.5 times he or she had with the prior firm to get the bonus, the second recruiter said.

And this comes as New York-based Merrill Lynch & Co. Inc., which was acquired by Bank of America Corp. of Charlotte, N.C., at the end of last year, is reopening its training program for brokers.

In addition to the reps generating $800,000 or more in fees and commissions, Merrill is targeting brokers who range from the first to the third “quintile,” or the top 20% to 60%, in production, recruiters said.

“Merrill is giving recognition to the fact that there are phenomenal brokers whose numbers are off because of the market,” the second recruiter said.

The firm is also looking to hire potential rising stars, the recruiters said. That would include a broker with a couple of years’ experience who annually generates $200,000 or more in fees and commissions.

Just last week, Bank of America CEO Kenneth Lewis tapped Ms. Krawcheck to replace Dan Sontag and run the bank’s global wealth and investment management sector.

With the historic collapse and the credit crisis that wiped out a number of storied investment firms, Merrill clearly has lost its foothold as the biggest retail-brokerage firm on the street.

Merrill’s reputation as the world’s largest brokerage army has been eclipsed by New York-based Morgan Stanley, which this year formed a majority-owned joint venture with Smith Barney — Ms. Krawcheck’s former firm — that gives it about 18,445 advisers around the world and client assets of $1.4 trillion.

Merrill at the end of June had about $1.2 trillion of client assets and 13,000 legacy financial advisers (excluding about 2,000 BofA brokers who had adopted the Merrill brand), down from almost 16,100 six months earlier.

A Merrill Lynch spokeswoman, Selena Morris, said the firm wouldn’t comment on a conference call. She added: “As always, recruiting and retaining quality advisors is a top priority for Merrill Lynch wealth management.”