Why BofA Weighed Name Change for Investment Bank
In the last six years, the Bank of America corporate family has markedly changed face: buying Countrywide, salvaging Merrill Lynch from the brink of collapse, shedding $40 billion in other assets and streamlining its workforce.
So should its name change, too?
That was the question facing the Charlotte, N.C.-based bank in May, when an executive brain trust tapped new advertising agencies to tackle Bank of America’s first formal brand review since 2006, according to people familiar with the process.
One option heavily weighed: stripping BofA from the investment bank title, currently Bank of America Merrill Lynch. (Read More: Bank of America to Cut 16,000 Jobs by Year-End: Report.)
Throughout the course of recent months, a team led by chief marketing officer Anne Finucane canvassed hundreds of bankers to discuss whether four years after the two banks’ shotgun marriage, simplifying the investment bank’s complex title would help it gain business — and specifically gain more traction abroad.
“It’s not like they completely walked away from the [Merrill] brand,” said Kevin Keller, professor of marketing at Dartmouth College and onetime consultant for Bank of America. “It’s not as if one brand was dropped — another brand was on for the ride.”
The crux of the questioning, according to bankers surveyed, was fairly straightforward: Had the pro forma bank lost clients that previously did business with Merrill Lynch? Was a brand with “America” too jingoistic to establish big footprints in emerging markets?
(Though Finucane told me the bank found no overwhelming evidence of that, some bankers disagreed.)
"You go to China, and [clients] think they're dealing with a government bank," according to one senior banker and Merrill Lynch alum. "They go running in the other direction."
Ultimately, the investment bank has decided to stick to its nine-syllable guns as Bank of America Merrill Lynch — though the private bank remains Merrill Lynch Wealth Management and the broker-dealer’s legal name remains Merrill Lynch Pierce Fenner & Smith Incorporated, a title carried in small print on every business card.
But even without any specific changes forthcoming, any desire to simplify the name – and potentially strip the BofA detail – would be a departure for Finucane, a 16-year veteran of Bank of America and its predecessors, and known as an adamant defender of its name. (Read More: Bank of America to Reap Mortgage Windfall: Analyst.)
One water cooler anecdote has Finucane discussing the matter on a senior leadership retreat with legacy Merrill Lynch bankers in Europe shortly after the 2008 merger. When the bulls pleaded to reinstate the Merrill Lynch name, Finucane boldly reminded them, with expletives, who bought whom.
Maintaining the brand would also be a bold step for Tom Montag, the bank’s co-COO and Merrill alum who has represented other legacy employees in keeping the Merrill reputation intact — in one instance, by winning a fight to put the Merrill Lynch bull back on BofA business cards. (As of 2009, an outline of the iconic bull logo appears on the back.)
While Merrill’s brand carries association of crisis and leverage, Bank of America’s isn’t exactly sacrosanct. It’s come under fire for its purchase of Countrywide, as well as its association with foreclosure fraud and rising consumer fees.
“These brands go through ups and downs – scandal or economic cycles, which makes it more complicated,” Keller said. “The brands aren’t as clean or pure as in other industries.”
Since Merrill Lynch and Bank of America joined forces in 2008, the bank has seen its top ranking on global league tables slip to number two, behind JP Morgan, according to data compiled by Dealogic.
Though the bank has nixed sacrificing the Bank of America brand for a return to the thundering herd, it remains unclear how the bank — which, according to BrandZ, saw its brand slip out of the top 100 most valuable brands from a perch in the top 15 years earlier — plans to reposition itself.
But that should become clear at the start of 2013.
—By CNBC's Kayla Tausche @KaylaTausche
CNBC’s Jesse Bergman contributed reporting to this story @JBergmanCNBC