BofA Reports 47% Jump in Merrill, Private Bank Profits: Q4 Earnings
What You Need to Know
BofA’s wealth management unit ended Q4 with 18,846 advisors, down just a few from Q3.
About 1,000 trainees have entered its new advisor development program since it launched in June.
Digital usage remains strong among clients.
Bank of America profits rose 28% from last year to $7 billion, or $0.82 a share, on a 10% jump in revenue to $22.1 billion in the fourth quarter ended Dec. 31, it said Wednesday.
The latest financial results benefited from revenues growing faster than expected, according to the company.
The bank’s global wealth and investment management division, which includes Merrill and BofA Private Bank, had a 16% year-over-year increase in revenue, growing to $5.4 billion. Its net income jumped 47% to $1.2 billion.
Total client balances were $3.8 trillion, up 15%, “driven by higher market valuations and record client flows,” the company said in its earnings news release.
What Your Peers Are Reading
Total client flows across the wealth unit reached a record $171 billion in 2021, “more than a threefold increase” from 2020, a senior Merrill executive told reporters on a phone briefing Wednesday morning.
“We attribute this significant increase in flows to two things,” he said. “First, the success of our organic growth strategy through which we’re attracting new clients and deepening relationships with existing clients.”
And, second, the growth strategy was in place during a period of “tremendous wealth creation in the U.S.,” he said.
Total Merrill client balances were $3.2 trillion, up 14%, with assets under management representing $1.3 trillion, up 17%. It added about 6,700 net new households in Q4, up 32%, and more than 23,000 in 2021, up 6% from 2020, the company said.
Total Private Bank client balances were $625 billion (up 16%), with AUM of $360 billion (up 15%). The division added about 500 net new relationships in Q4, up 30%, and about 1,900 net new relationships in 2021, up 7% from 2020, the company said. It also added about 2,500 new individual clients to existing relationships, reflecting about a 10% increase in multi-generational accounts.
Flat Advisor Headcount Again
The firm’s wealth management unit had a total of 18,846 advisors as of Dec. 31, including Merrill, BofA Private Bank and some Consumer Investments professionals.
Relevant Resources
Advisor headcount was about flat from the third quarter that ended Sept. 30, when it reported having 18,855 advisors, and was down 6% from a year ago.
