UBS’ wealth management arm has announced a new compensation programme for its financial advisors that is designed to reward brokers for remaining loyal to the Zurich-listed bank, media reports said.

Robert McCann, chief executive of UBS’s wealth management business in the Americas, announced the new programme in New York yesterday.

Mr McCann has recently joined UBS from Merrill Lynch. His appointment to the the North American arm of UBS, bringing with him former Merrill Lynch colleagues, has prompted speculation on whether UBS will retain its Americas business or is thinking of the option of selling this division off.

The new programme is targeted at long-time UBS brokers who generate at least $500,000 in revenue next year. Members of that group, which is estimated to be about 40 per cent of UBS’s 7,000 financial advisors in the Americas, will be eligible for a cash bonus, in the form of a seven-year forgivable loan, equal to 65 per cent of next year’s production, according to the Financial Times.

The financial  advisory business in the US has been in ferment due  to a wave of merger and acquisition activity and because of the financial turmoil. Morgan Stanley has formed a new brokerage business with its joint venture with the Smith Barney brokerage business of Citi, while Bank of America has become the world’s largest wealth manager through its purchase of Merrill Lynch.