Bank of America to dissolve Merrill Lynch

Merrill Lynch Building Sign

It was only a matter of time

Bloomberg News reports that Merrill Lynch may cease to exist as a legal entity more than four years after being acquired by Bank of America.

While Bank of America will keep the Merrill Lynch brand for its retail brokerage and investment bank, the Charlotte, the company plans to dissolve the subsidiary as early as the fourth quarter, according to an August 2nd filing. The firm will assume Merrill Lynch’s obligations and debt.

Bank of America is simplifying its structure after CEO Brian T. Moynihan’s predecessor bought Merrill Lynch in 2009. Merging the legal entity could help Moynihan hit his $8bn-a-year cost-cutting target and comply with regulators who want to make the biggest banks easier to resolve in a crisis.

'Less-complex structures would increase the success of resolution planning via living wills in the case of potential worst-case financial distress scenarios,' David Hendler, an analyst at CreditSights, said today in an e-mail with the subject line: 'Bye Bye Merrill Lynch & Co.?'

Dissolving the legal entity also ends Merrill Lynch’s need to file separate regulatory disclosures. The move will have 'no impact' on how the firm serves clients or on the Merrill Lynch brand, said Jerry Dubrowski, a Bank of America spokesman.

To access the complete Bloomberg article hit the link below.

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