BAC Bank of America Corporation

By Michael Wursthorn And Peter Rudegeair 

Bank of America Corp.'s Merrill Lynch unit is shuffling several of the top executives who oversee the brokerage's more than 14,000 financial advisers, in the wake of broader cost cuts at the bank.

Merrill also told its brokers this week that it would consolidate its so-called Heartland division to reduce the number of market regions to 10 from 11, according to a memorandum viewed by The Wall Street Journal and people familiar with the matter. Merrill's market division heads oversee numerous so-called complexes, or clusters of branch offices, in groups of states throughout the U.S.

The Heartland division comprised states including Wyoming, Colorado, Oklahoma and Arkansas. Those states will be split into neighboring markets, the memo said.

The division's dissolution is part of Merrill head John Thiel's effort to simplify the firm's management structure, according to the memo. But it also comes after Bank of America Chief Executive Brian Moynihan said last month that he would further reduce costs if results didn't improve.

Earlier this week, Bank of America began laying off roughly 200 employees in its trading and investment-banking units.

Merrill's Heartland region head, Jodi Rolland, will shift into Bank of America's global commercial bank as its Colorado market executive, the memo said, as the company further shifts executives between the bank and wealth management. She is focused on growth opportunities in Colorado, the memo said.

Meanwhile, Jeff Ransdell, Merrill's Southeastern U.S. head, will retire to pursue new opportunities, the memo said. Mr. Ransdell had been with the firm for 20 years, starting as a broker before eventually managing advisers in Florida, Alabama, South East Georgia, the Caribbean and Latin America.

In July, Merrill said that it would reconfigure its international wealth business to create a specialized team of financial advisers to handle clients in 29 countries, including those in Latin America. The move in part refocused Merrill's efforts on those countries since selling its international wealth-management offices in 2012 to Swiss private-banking specialist Julius Baer Group AG.

But Merrill also raised account minimums for clients in those regions to require those investors to have balances above $1 million. It wasn't clear if that strategy change contributed to Mr. Ransdell's decision to retire as he couldn't be reached for comment.

Replacing Mr. Ransdell is Don Plaus, who had been overseeing Merrill's South Atlantic region. And Eric Schimpf, a regional managing director for Merrill's ultrawealthy client unit, the Private Banking and Investment Group, and head of global corporate and advisory services, will take over Mr. Plaus's vacated role. A replacement for Mr. Schimpf will be named shortly, according to the memo.

People familiar with the matter said Mr. Schimpf is a close ally of Mr. Thiel. Mr. Schimpf rejoined Merrill in 2014 after nearly three years at Macquarie Group. Prior to that, he had worked at Merrill in various capacities between 1994 and 2007.

These shifts are one of Merrill's biggest management shakeups of its adviser force since 2014, when more than a dozen of the brokerage's 115 complex directors retired or were reassigned. Since then, there had been a few significant moves, but they didn't include broad reorganizations of adviser divisions or complexes.

For example, in July, Merrill's chief investment officer, Ashvin Chhabra, decided to leave the firm to run a family office. Instead of replacing Mr. Chhabra, Bank of America opted to create a joint CIO role that works with both Merrill and private bank U.S. Trust. It named Chris Hyzy, the CIO for U.S. Trust, to that position.

Mr. Moynihan has charged Mr. Thiel with improving the brokerage's profit margin, which inched higher to 24% in the second quarter from 23% in the first quarter, but was still down from 25% a year earlier. Mr. Moynihan told analysts in July that Mr. Thiel and his counterpart at U.S. Trust, Keith Banks, had been "working hard on revenue expense management" and that they were starting to see "some better signs." But he added that they had "some work to do still."

Earlier this year, Mr. Moynihan told analysts in a separate conference call that Mr. Thiel was doing "a great job" for Bank of America.

Despite its cost-consciousness, Merrill has been putting significant emphasis on raising its adviser headcount this year, more so than some of its peers. In the second quarter, it had its best recruitment quarter since 2011 and reported a net new adviser gain higher than UBS Group AG's U.S. wealth unit, Morgan Stanley and Wells Fargo Advisors, which all reported flat or lower headcounts over the summer.

As of June 30, Merrill had 14,370 advisers.

A Merrill spokeswoman confirmed the organizational changes.

Write to Michael Wursthorn at michael.wursthorn@wsj.com

Subscribe to WSJ: http://online.wsj.com?mod=djnwires

(END) Dow Jones Newswires

October 01, 2015 16:47 ET (20:47 GMT)

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