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Merrill Lynch Wealth Management’s Sieg on robo-advice, wealth-tech – Business Insider UK


  • The head of Bank of America’s wealth management business, among the largest in the US, said on Wednesday that his unit was not planning to acquire a robo-adviser. 
  • Investment-focused tech startups “mainly had their heyday in the mid 2010s and learned some hard lessons along the way,” the Deloitte Center for Financial Services said in a report published Wednesday. “As a result, many have shifted to a business-to-business (B2B) model, merged with incumbents, or simply disappeared.”
  • Andy Sieg, the president of Merrill Lynch Wealth Management, told Business Insider that the unit is focused on investing in Merrill’s existing technology and trying to ensure that its thousands of financial advisers are incorporating the full menu of tech into their practices.  
  • That thinking highlights how standalone robo-advice and wealth-tech firms may be in a tricky spot as legacy firms invest in their own technology. Meanwhile, the pipeline of new startups in the space has ground nearly to a halt. 
  • The firm has also doubled the number of its “digital specialists,” from 15 to 30, who are responsible for guiding advisers on how best to harness new technology. 
  • Visit BI Prime for more wealth management stories.

The head of Bank of America’s massive wealth management business said on Wednesday that buying a robo-adviser was not in the cards for the unit.

Andy Sieg, the president of Merrill Lynch Wealth Management, said the unit is focused on investing in Merrill’s existing technology, which includes its own self-directed investing tool, and trying to ensure that its thousands of financial advisers are incorporating the full menu of tech available to them into their practices. 

“The best road to the future for us is continuing to invest in our own platforms, and ensure that they’re leading the marketplace in terms of capabilities,” Sieg, who has led the business since 2017, told Business Insider. 

That thinking highlights how standalone robo-advice and wealth-tech firms may be in in a tricky spot as legacy firms invest in their own technology. Meanwhile, the pipeline of new start-ups has ground nearly to a halt. 

“They mainly had their heyday in the mid 2010s and learned some hard lessons along the way,” the Deloitte Center for Financial Services said of the fintechs it broadly groups as “invest-techs” in a report published on Wednesday. “As a result, many have shifted to a business-to-business (B2B) model, merged with incumbents, or simply disappeared.”

merrill lynch office


Daniel Barry / Stringer / Getty Images


The San Francisco-based startup SigFig, for its part, has pivoted in recent years from a business-to-consumer to a B2B business model.

Meanwhile the number of invest-tech firms coming to the market has dwindled since a post-financial-crisis peak of 81 in 2014, according to Deloitte’s report.

Just four launched in 2018, and only one debuted last year.

“As invest-techs mature, they are now tasked with striking the right balance between collaboration and competition to secure their place at the forefront of the industry,” Deloitte’s team wrote.

The global head of financial technology banking at RBC told Business Insider earlier this month that while some robo-advisers’ growth has been quite impressive, “to make the business models work, it’s predicated on AUM levels that are much higher than where they sit today.”

At the same time, legacy wealth managers like Merrill Lynch and peers like Morgan Stanley have to grapple with attracting a new generation of wealth and brokerage customers accustomed to cheap, automated transactions with brands that only emerged in the wake of the global financial crisis. 

Some 72% of Merrill Lynch clients are actively using Merrill Lynch and Bank of America’s online or mobile platforms, Sieg said on Wednesday after Merrill and parent Bank of America reported fourth-quarter earnings results.

Within that base, the number of clients using the MyMerrill app — separate from its self-directed offering — rose 44% in one year. Last year, the business launched new digital features for clients, including the ability to scan and upload documents into the MyMerrill app, as well as sign documents directly with the app and send them to advisers. 

The firm has also doubled the number of its “digital specialists,” from 15 to 30, who are responsible for guiding advisers on how best to harness new technology. 



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