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Revenues, Income Rise At BoA Merrill Lynch's Wealth Businesses

Tom Burroughes

18 January 2018

yesterday said its global wealth and investment management arm’s net income rose 17 per cent year-on-year in the fourth quarter of last year to $742 million.

This part of the US-listed lender logged revenue of $4.7 billion for the quarter, a gain of 7 per cent compared to 4Q 2016, driven by higher asset management fees and net interest income, which more than offset lower transactional revenue. 

Assets under management flows reached a record $96 billion for the year, driven by both strong client activity and continued AuM shift from IRA brokerage accounts into managed relationships, the firm said in a statement. In the quarter, there were AuM flows of $18.2 billion, and $96 billion for the year.

The division reported a pre-tax margin of 26 per cent, up from 23 per cent in 4Q 2016, driven by solid revenue growth and expense management. The total number of wealth advisors, at 19,238, rose 3 per cent from the level in 2016. 

US Trust
The US Trust business, which works with wealthy families and ultra-high net worth clients, logged a 9 per cent year-on-year gain in revenue, at $845 million, in Q4, and up 3 per cent from the previous quarter. 
The unit chalked up record client balances of $446 billion, a 3.6 per cent quarterly rise, and a 10 per cent rise on a year before.

The pre-tax margin of this business was “industry-leading”, BoA ML said. There were 382 private client advisors at US Trust at the end of the year, a gain of 8 per cent from a year earlier. 

Merrill Lynch Wealth Management  
The Merrill Lynch business “achieved another strong quarter, assisted by solid client activity and continued momentum from the market”, BoA ML said.

The business reported record client balances of $2.3 trillion, up $60 billion from the previous quarter and up 10 per cent on a year earlier, driven by higher market values and client flows

At Merrill Lynch Advisors, the number of advisors rose 2 per cent on the year earlier in Q4, standing at 14,953 advisors at the end of 2017. Financial advisors chalked up an average productivity of $1.31 million per advisor, a gain of 1 per cent on the third quarter of 2017.