CORRECTED-Merrill launches new training track to help team strategy

Tue Jul 22, 2014 9:19am EDT

(Corrects in 8th paragraph to show revenue hurdles are annual, not monthly.)

By Michael Leibel

July 21 (Reuters) - Merrill Lynch Wealth Management told its brokers on Monday it is starting a new track in its training program that will help fill skill gaps on teams and potentially develop successors for their practices.

The big brokerage unit owned by Bank of America said it will enroll some of its trainees in an advanced path that, in addition to teaching core management skills, focuses on specializations that immediately allow participants to integrate with a team starting next month, according to an internal memo issued to the company's financial advisers.

Large firms such as Merrill, which has almost 14,000 financial advisers, have been encouraging advisers to work in teams because they tend to be more productive than are brokers who work individually, and are also less likely to jump to rival firms.

It is currently running its first internship program in which college undergraduates have been placed directly in Merrill branches for the summer to learn what brokers are expected to do.

Merrill expects participants in the newly dubbed Team Financial Adviser, or TFA, track to complete the 31-month training regimen with an added concentration in one of the following specializations: Business Development (new clients); (Financial) Planning; Investments and Financing; Relationship Management (defined as deepening existing client relationships rather than developing new ones); and Business Management (developing and executing a defined business plan).

"The difference [versus Merrill's Practice Management Development program] is that you're immediately being tied to a team, where you're already specialized, and you're going to have a long-term relationship with that team," Racquel Oden, head of adviser strategy and development at Merrill, said in an interview.

The program is aimed at advisers as much as at trainees. Teams that want to hire a TFA must submit a business proposal identifying the specialization they want to fill and a performance plan that they and the new hire will be expected to meet.

The firm will assess the plan to determine if there should be a match. If so, the financial advisers will interview potential candidates. Once a TFA comes aboard, the team and the new member will be expected to meet an annual revenue hurdle, Oden said.

Merrill plans to offer new TFA classes each month, Oden and Riley Etheridge, Merrill's head of client segments and adviser development, said in the memo.

"This new role [of TFA] can also allow for succession planning and building the bridges necessary for the next generation of advisers to continue to deliver the experience our clients expect and deserve," the memo said.

Like many securities firms, Merrill Lynch is concerned about retaining clients of older brokers once they retire. The average age of financial advisers is in the 50s, and many have not focused on succession plans, according to numerous industry studies. (Reporting by Michael Leibel; Editing by Jed Horowitz and Dan Grebler)

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