Robert McCann, UBS Wealth Management Americas CEO, successfully brought four former Bank of America-Merrill Lynch senior managers with him to UBS, but it will be difficult for him to poach any more talent from his former firm, sources close to the matter told CNBC.
Bank of America has distributed at least 2,000 $1 million checks to retain talent from Merrill Lynch over a seven-year period, the sources said. Therefore, if McCann were to make a move toward other BofA talent, he would have to buy them out of their retention bonuses, and then he'd most likely have to match the bonuses to persuade them to switch firms.
This could result in UBS spending around $4 billion, which sources said McCann doesn't have the approval to do.
Bank of America has considered switching its compensation system to put brokers on a salary and bonus structure — particularly its top brokers — which would make it much easier for McCann to lure them over, sources said.
"We were not changing our compensation structure for advisers nor was that ever even a consideration," Merrill Lynch Wealth Management spokesperson Selena Morris told CNBC.
BofA President of Global Wealth and Investment Management Sallie Krawcheck, in an October 5th interview, told CNBC that despite turnover at the top of the firm, there is a lot of continuity at the branches, and many of their clients have worked with the same adviser for years.
She also said that the bank's advisers are paid through fee-based assets and commissions from clients, so BofA is having no trouble staying competitive.
"The right way to build a company going forward is to bring in people early in their career and build them up," Krawcheck said.