Bank of America Corp. said it would phase out the name Merrill Lynch from some businesses. Charlotte, N.C.-based Bank of America bought that storied Wall Street firm more than a decade ago.
Bank of America plans to remove the Merrill Lynch name from its trading and investment-banking operations, executives said Monday. It will also rebrand the bulk of its wealth-management business as simply Merrill. Those are the key businesses that Bank of America acquired in the deal, when Merrill Lynch sold itself in a fire sale in the heat of the 2008 financial crisis.
The rebranding marks the end of an era. Merrill Lynch had a long history on Wall Street. Unlike other firms that were bought during the crisis, it managed to live on, in name at least, after the acquisition.
The change also reflects how times have changed at Bank of America. The bank was once too embroiled in various postcrisis problems to devote energy to renaming the major businesses it bought. But now it is minting steady, record profits, in part by encouraging its various units to work more closely together. “We are continuing to unify the company, continuing down the road we started on a decade ago,” Chief Executive Officer Brian Moynihan said in an interview.
Merrill Lynch was founded in 1914 by Charles Merrill. His friend Edmund Lynch soon joined him. Over the years, the firm grew into an army of brokers across the country, sometimes called the “thundering herd” for the bull used in the company’s logo, that helped bring investing to the masses. The company also built a formidable investment bank. Its corporate culture was dubbed “Mother Merrill” for its maternal attitude toward employees and clients.
In the 2000s, then-CEO Stanley O’Neal pursued a more performance-driven strategy that put greater emphasis on riskier bets, such as accumulating subprime mortgage assets. Eventually, that dalliance caused the company serious problems that led to its sale.
Bank of America was a bank with deep roots in the South that had grown rapidly through plain-vanilla businesses such as retail banking and business lending. Overnight, the deal made the North Carolina bank a huge player in Wall Street businesses such as investment banking and trading as well as wealth management.
The proposed merger quickly became embroiled in conflict. Culture clashes continued after the close, and some Merrill Lynch veterans chafed at being branded with the Bank of America name. Early on, Bank of America executives announced they would keep the Merrill Lynch name on certain businesses “for the longer term.” In 2012, the Journal reported that the bank had weighed changing the Merrill Lynch names but decided against it.
The investment bank, trading operations and units dealing with corporate clients have been known as Bank of America Merrill Lynch, or BAML for short. The units working with corporate clients will now go by Bank of America. The investment bank and trading businesses will be called BofA Securities.
The bulk of the bank’s wealth business, from the Merrill Edge business that caters to retail customers to Merrill Lynch Wealth Management with its financial advisers, will fall under the new umbrella name Merrill. The trademark bull will remain in its logo. U.S. Trust, a 2007 wealth-management acquisition that works with ultrawealthy clients, will now be called Bank of America Private Bank.
The decision to use part of the Merrill Lynch name in the wealth-management brand was “obvious,” Mr. Moynihan said. “In the wealth-management business, it’s the No. 1 brand there is.” While the names of the various units are changing only now, the culture of what was once Merrill Lynch has already transformed under Bank of America’s ownership.
Mr. Moynihan has implemented a bankwide strategy of “responsible growth,” which emphasizes stability over swagger and frowns on the sort of risk taking that once made Merrill Lynch lots of money but also played a major role in its downfall.
What’s more, many of the current senior executives in investment banking and trading, for instance, never worked at Merrill Lynch. Tom Montag, who oversees those businesses, worked there only briefly before the acquisition after years at Goldman Sachs Group Inc.
Mr. Moynihan has pushed the various units to work together, though that can be a challenge. In the wealth-management unit, the independent-minded financial advisers across the country are increasingly working with the consumer-banking unit. They are now encouraged to pitch clients bank accounts and other consumer products, which has led some to grumble.
That business has helped make Bank of America’s customer base higher end. In the third quarter, for instance, 36% of the bank’s mortgage portfolio was from the wealth-management business. Mr. Moynihan, who became CEO in 2010, is focusing more on branding now after years of toiling to put out fires. The bank introduced a revamped logo and advertising tagline late last year.
Bank of America’s 2018 profit of $28.15 billion is the largest in the lender’s history. While the corporate tax cut and rising interest rates have helped the bank’s earnings, years of cutting expenses and focusing on key products such as primary checking accounts have also played a major role.