The new service will address defined contribution plans that includes 401(k), ERISA, 403(b), profit sharing and money purchase plans and BofA will assist the plan sponsor with menu design, due diligence and investment option recommendations and working to monitor those investments as a fiduciary, Financial Planning stated.
The new service will become available this year and next year to institutional clients US$25 million or more in defined contribution plan assets.
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"Our estimate is that the market is approximately US$1.2 trillion of defined contribution assets that are actively seeking these types of services," Financial Planning quoted Steve Ulian, head of institutional retirement relationship management for Bank of America Merrill Lynch as saying.
Further, Ulian estimates that of those having US$1.2 trillion in assets, the top 25 consultants represent about 92% of the overall market, while the top 10 consultants represent about 77% of the market.
For those advisers wanting to be specialized in these services, BofA is launching new accreditation and the number of advisers who will undergo training in the first year will mostly range from 30 to 50.
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