The End of Big Bonuses?
From the Desk of Jim Eccleston at Eccleston Law Offices:
Morgan Stanley and Bank of America Corp. may be signaling the end of big bonuses for brokers. Lucrative bonuses for recruiting and retention purposes have been used to lure and reward top performing brokers. Both brokerage firms, however, are seeing a decrease in compensation and recruiting costs. In fact, Bank of America will not offer any retention bonuses to Merrill Lynch’s top performers after a previously structured agreement expires.
Morgan Stanley and Bank of America are both on board to move the financial industry in this direction. Stifel Financial Corp., however, labels this behavior as anti-competitive and discouraging for brokers. According to Danny Sarch, president of recruiting firm Leitner Sarch Consultants, brokerages replace retiring advisers by recruiting from each other. Sarch believes internal training programs are not producing enough successful brokers, and the current trend only undermines the principles of supply and demand. He is less than optimistic about firms being able to change the industry..
The attorneys of Eccleston Law Offices represent investors and advisers nationwide in securities and employment matters. Our attorneys draw on a combined experience of nearly 50 years in delivering the highest quality legal services.
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