Bank of America ended another quarter with fewer financial advisors than it had earlier, but neither that nor the shrinking client balances could stop the firm’s the global wealth and investment management unit from posting a healthy bump in income.
The total number of wealth advisors at the firm, which includes those at Merrill Lynch, BofA Private Bank and consumer banking, slipped to 18,449 at the end of June, down from 18,571 at the end March and from 19,385 at the end of June 2021, according to the firm’s second-quarter earnings report.
Client balances at the global wealth and investment management unit, which includes Merrill Lynch Global Wealth Management and BofA Private Bank, stood at $3.4 trillion, which was 8% lower year-over-year, the company says, attributing it to “lower market valuations, partially offset by net client flows.”
Assets under management in the division — defined as managed assets under advisory and/or discretion of the global wealth and investment management unit — dropped to $1.41 trillion at the end of the latest quarter, down from $1.57 trillion at the end of the first quarter and from $1.55 trillion at the end of June 2021, according to the report.
Client balances at Merrill stood at $2.82 trillion at the end of the latest quarter, down from $3.12 trillion at the end of the first quarter and from $3.07 trillion at the end of June 2021, BofA says.
The company adds that Merrill added around 4,500 net new households in the latest quarter.
Average loan and lease balances, meanwhile, rose for the 49th consecutive quarter, to $219 billion, representing a 13% increase year-over-year, according to the report.
Meanwhile, the unit posted $5.43 billion in total revenues in the latest quarter, down slightly from the $5.48 billion reported in the second quarter but 7% higher year-over year, BofA says. The company attributed the growth to “the [net interest income] benefit from higher balances and higher interest rates.”
Non-interest expenses in the unit dropped from $4.02 billion in the first quarter of 2021 to $3.88 billion in the latest quarter, but that was 2% higher than in the second quarter of 2021, which the firm attributes to higher employee-related expenses.
Nonetheless, net income in the unit was $1.15 billion in the latest quarter, slightly up from the $1.13 billion posted in the first quarter of the year and 16% higher year-over-year, according to the report.
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