BofA Set To Jack Up Fees For Thousands Of Brokerage Account Holders
If your money is managed by Bank of America's brokerage arm, get ready to pay more for the service.
BofA plans to jack up fees for thousands of Merrill Lynch customers as part of a $100 million "platform overhaul ... designed to make it easier for advisers to manage their clients' accounts and build portfolios," the Wall Street Journal's Corrie Driebousch reports.
With the new platform, unofficially called Merrill Lynch One, customers will be charged minimum fees based on the size of their investment. The move comes as big brokerage firms struggle to make up for lost assets during the recession. Advisors have until 2015 to adopt the new pay scale, and if they agree to use the new platform, some investors could see their fees increase by up to 50%.
"This change will transform the investment advisory business as it makes it more client- and advisor-friendly – breaking down historically burdensome relationship barriers to allow for much simpler and efficient ways of doing business," Susan McCabe, a BofA spokesperson, told BI.
Even so, some in Merrill Lynch's 14,000-strong fleet of advisors aren't all that thrilled.
They say the fee structure will only limit their pricing flexibility (for example, giving a good customer a discount) and could drive some customers away. But McCabe insists that new platform fee structure will be optional.
"There is no automatic fee change," McCabe said . "Clients have the option of using the new single platform and will sign a new agreement that will include an agreed upon fee. That fee will reflect the full value the client places on the overall advice and service delivered by the advisor and firm."
Read about what to expect from the new fee structures over at the Journal >
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