Deals & People July 20, 2015

BofA Has Management Changes in Retirement, Investment Units

In the wake of David Tyrie’s move to a different unit, Bank of America has announced a number of staff changes.
Reported by

Andy Sieg, head of global wealth and retirement solutions (GWRS) at Bank of America Merrill Lynch, has announced a series of changes to his leadership team.

David Tyrie, previously head of retirementand personal wealth solutions, will now lead the retail and preferred products division in Bank of America’s consumer banking organization. He reports to Dean Athanasia, president of preferred and small business, and Thong Nguyen, president of retail banking.

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Taking over from Tyrie, Lorna Sabbia will lead the retirement business as head of retirement and personal wealth solutions. As head of managed solutions, Sabbia drove extraordinary progress, including the creation and implementation of Merrill Lynch One, the largest and most successful investment advisory platform launch in industry history.

Keith Glenfield replaces Sabbia as head of the managed solutions group. Glenfield has been with Merrill Lynch for 20 years, and he will drive continued strategic progress and growth as he has done over the past three years in the alternative investments business.

Nancy Fahmy, taking over from Glenfield, will be the new head of alternative investments. She was previously head of private equity origination and technical sales, where she led record-setting performance results and fostered key relationships with alternative asset managers and advisers.

Patricio Diaz will be the chief operating officer (COO) for GWRS. Diaz joined Merrill Lynch in 2007 and has deep international and structured products experience. Most recently, he served as COO for the investment management & guidance business.

Liam O’Neil continues in his role as head of the GWRS Markets Group and will remain focused on maximizing the value of our extraordinary Bank of America Merrill Lynch capital markets franchise and capabilities for its advisers and clients.

Chris Hyzy will lead the newly created global wealth and investment management (GWIM) chief investment office, reporting jointly to Andy Sieg and U.S. Trust President Keith Banks. In addition to his new role, Hyzy remains chief investment officer for U.S. Trust. Under a simplified structure, the Merrill Lynch and U.S. Trust Chief Investment Offices will be brought together, combining the best thinking of both organizations to help advisers provide clients with relevant insights and actionable ideas.

Ashvin Chhabra, former chief investment officer and head of investment management and guidance for Merrill Lynch Wealth Management, recently announced his decision to leave the firm and pursue a new opportunity, running a family office. 

Data & Research July 20, 2015

B/Ds Embracing Fixed Indexed Annuities

Fixed indexed annuity sales increased 24% in 2014 to $48 billion.
Reported by

Broker/dealers (B/Ds) are increasingly embracing fixed indexed annuities (FIAs), according to a survey by the Insured Retirement Institute (IRI). Sales of fixed indexed annuities rose 14% in 2013 to $38.7 billion and 24% in 2014 to $48 billion—or about 21% of all annuity sales. Since 2012, fixed indexed annuities have outsold traditional fixed annuities, IRI says.

Seventy-nine percent of B/Ds say that 11% or more of their financial professionals sell fixed indexed annuities, and 29% say that more than 50% of their financial professionals sell these products. Sixty percent say that annuities comprise 10% to 25% of their total sales, and 20% say they comprise 26% to 50% of their total sales.

However, variable annuities (VAs) with guaranteed lifetime withdrawal benefits capture 48% of all annuities sales, followed by variable annuities without guaranteed income (22%) and fixed indexed annuities (10%). Nearly four out of 10 B/Ds (39%) say that their sales of FIAs are growing significantly, and 31% expect sales to grow significantly in the future. Forty-three percent of B/Ds (29%) say that their financial professionals are either extremely or very receptive to RIAs with lifetime income.

“While variable annuities capture the lion’s share of premium dollars in third-party distribution channels, sales of FIAs are growing, reflecting the appeal of the product to both advisers and consumers,” the survey concludes. “They can provide principal protection, some upside potential and guaranteed income benefits comparable to those currently available on VA products. Advisers and consumer value these attributes, as evidenced by their receptivity to FIAs, particularly when guaranteed lifetime income benefits are offered.”

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IRI based its findings on a survey of 15 member distributor firms between January and March 2015. The full report can be downloaded here.

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