The world’s largest wealth manager Bank of
America Merrill Lynch (BofA) has denied rumours it is putting its
wealth management units outside the US up for sale.
BofA declined to comment on a Reuters report that suggested
BofA’s two non-US arms, one of which manages $90bn worth of assets,
are to be sold.
Go deeper with GlobalData
The bank has asked potential suitors to put in first-round bids
this week, according to Reuters sources.
BofA was looking to sell the unit as a whole with the deal could
bring $3bn, or more than $3% of assets under management.
Possible bidders could include UBS, Credit Suisse, Deutshe Bank,
JPMorgan Chase & Co, and Well Fargo, said sources.
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By GlobalDataPart of Project New BAC?
In more than two years under chief executive Brian Moynihan,
BofA has moved to shed non-core businesses and investments in other
companies.
BofA has made a number of significant changes to its wealth
management business since the start of its radical two stage
restructure, Project New BAC, started in April last year.
Phase I of Project New BAC saw the
bank announce 3,500 job cuts with an estimated 10,000 further
redundancies and a drastic management restructure, including the
surprise departure of Sallie Krawcheck, head of the bank’s Global
Wealth and Investment Management (GWIM) arm.
Krawcheck was replaced by Dan Cummings as a head of
international wealth management (IWM) in October.
Phase II, which began in October and
was set to conclude in March 2012, was understood to have led to a
further 30,000 jobs cuts with redundancies expected for wealth
management and operations management staff.
S&P’s prophecy coming
true?
In an interview with PBI in September last
year, S&P’s analyst said that the implementation of phase II of
Project New BAC, could result in BofA’s US-based wealth management
entity becoming increasingly integrated.
“BofA wants to integrate all the products
together and cross-sell to households. So, instead of households
just having a checking account, they [BofA] want to try to
cross-sell them into having a brokerage business and wealth
management, estate planning – everything,” Eric Oja, US banks
analyst at S&P’s Equity Research, told PBI.
