The author of "Catching Lightning in a Bottle: How Merrill Lynch Revolutionized the Financial World," Winthrop H. Smith Jr., son of Merrill Lynch pioneer Win Smith, gives On Wall Street his take on the era of “Mother Merrill,” and weighs in on the storied firm, which just completed its 100th year.
What was it like for advisors to work during the storied days of “Mother Merrill”?
Advisors had a tremendous pride in working for Merrill Lynch. They knew that from the days of Charlie Merrill and my father that the firm operated with a set of values.
That began with placing the interests of the client first, and they respected the leaders of the firm as men of integrity who understood clients.
I think they also appreciated the fact that Merrill's leaders treated people respectfully and helped fellow employees in need. The establishment of the Winthrop H. Smith Foundation in my father's honor is a good example.
I also believe that advisors enjoyed the personal contact that they had with the leaders of the firm, and the fact that their voices were heard.
Is the concept of advisors wanting to bring back that prestige more a case of living in the past by today's industry standards?
No, I think what they are saying is that the values and principles that were important to them are still valid now. One cannot go backward, but one can take the important things from the past forward.
What were the best qualities of the olden days?
It was the sense that Merrill was always going to do the right thing and that the leaders walked the talk. There was a pride in wearing the bull.
It is hard for an outsider to understand this, but people felt they were part of a family and not just an employee of a big corporation. And there was great pride in what Merrill created through its constant innovations.
For so many of us, our years there were like catching lightning in a bottle.
Should younger advisors care about the past?
Absolutely. History can be a precursor to the future. Understanding what it was that made Merrill great is important, and understanding how that is still applicable will enable you as an advisor to be successful.
Cultures develop through story telling, and there are some terrific stories from the past that can help young advisors build their own businesses the right way today.
What should Merrill reflect on as it celebrates more than a century in existence?
Not many companies last 100 years.
It is important to recognize that the values and principles that Charlie Merrill created were carried forth by his successors. He created a culture that allowed Merrill to get through both the good and the tough times.
Merrill made its share of mistakes, but its guiding principles always got it back on course. It's also important to understand that the culture was purposely changed in the few years leading up to 2007.
That was one of the major factors leading to the trading losses that led to Merrill's need to be acquired by Bank of America.
What do you think about the co-branding of the two firms after the acquisition?
I think it was very wise of BofA to allow the continued use of the bull and to allow the Private Wealth Management Group to operate as Merrill Lynch, Pierce, Fenner & Smith. Both have tremendous brand values and the employees are proud of their heritage.
Likewise, the co-branding on the corporate/institutional side seems like a smart move. Both BofA and ML have been strong and well-recognized brands.
How should Merrill have marked the anniversary?
BofA had a nice reception this past spring and invited many of Merrill's former leaders to it. The leaders of Merrill Lynch, Pierce, Fenner & Smith have been celebrating it all year. I have been invited to 20 receptions around the U.S. to speak about the first 100 years.
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