Bank of America Merrill Lynch

Merrill Lynch bankers seek new posts

A scramble for jobs has started ahead of the merger with Julius Baer, which is complicated by sector lay-offs due to the economic climate

PUBLISHED : Monday, 29 October, 2012, 12:00am
UPDATED : Monday, 29 October, 2012, 5:08am

Private bankers at Bank of America Merrill Lynch are scrambling for jobs in Hong Kong and Singapore ahead of the expected merger of the US bank's wealth-management business with Switzerland's Julius Baer.

Earlier this year, private banker Julius Baer said it would buy the US bank's wealth-management unit outside the US and Japan as part of a global expansion strategy, and expected to slash 1,000 jobs globally from the combined entity.

Julius Baer already employs about 500 people in Asia. Merrill Lynch has about 800 people manning its Asian wealth management business, mostly based in Singapore and Hong Kong.

It is unclear how many people will ultimately be employed by Julius Baer in Asia.

The threat of the staff cuts comes as many banks in Hong Kong have laid off, or are in the process of laying off, private bankers in a year marked by weak markets, diminished client appetite for investment and trading and intensified competition.

Merrill Lynch private bankers are waiting to be evaluated before they are offered a job with the new owner.

However, with regulatory and shareholder approvals expected to take place at the end of this year or early next year, and the full integration unlikely to be completed before late 2014 or early 2015, many Merrill Lynch private bankers have been rushing to get their resumes out.

Bankers at Bank of China International, Bank of Singapore and DBS in Singapore all said they had been in talks recently with potential candidates seeking to move over from the Merrill Lynch operations.

A DBS official said that to support the bank's ambitions in Asia, it continued to increase its staff strength "including quality relationship manager talents in Hong Kong".

Julius Baer and BOCI declined to comment. Bank of Singapore could not be reached for comment.

"A large proportion of bankers who are concerned about the stability of the organisation or the longer-term client strategy will be significantly more active in the market" looking to jump ship, said Nick Lambe, a managing director at recruitment firm Morgan McKinley.

Private bankers traditionally have been measured by how much business they can bring in to manage.

Lambe said that seasoned bankers who already had strong client relationships and portfolios of at least US$300 million of assets under management that they could bring to a new employer would find it relatively easy to secure a new job, providing they were flexible about the type of firm and their role within it.

But, he added, "bankers who cannot demonstrate the ability to bring this assets-under-management [aspect] on board or have been out of touch with their clients for a period of time will find it very challenging".

For private banks to maintain a profitable business, each relationship manager needs to attract and maintain at least US$150 million in assets to manage, according to Kenny Lam, a McKinsey partner who specialises in private banking.

Bankers who fail to bring in enough assets to manage often face the risk of being laid off after performance reviews that are usually conducted on a semi-annual or annual basis.