Jan. 23, 2001 Merrill Lynch reported today that profits inside its U.S. Private Client Group showed a "sharp improvement" in the fourth quarter and during the full year 2000, thanks in part to the cost-cutting measures it imposed last summer (see RR, Nov. 2000, OddLots).

An increase in fee compensation also contributed to the growth. The amount of money held in asset-priced accounts like Unlimited Advantage jumped 24% during the year, totaling $209 billion at the end of 2000, Merrill reported.

During a conference call held for analysts this afternoon, Merrill Lynch Director of Investor Relations Martin Wise added that the number of households with Unlimited Advantage accounts grew at an annualized rate of 20% during the fourth quarter, and that almost 70% of the clients who opened UA accounts in the fourth quarter were new relationships.

As far as the cutbacks go, CFO Tom Patrick told analysts that some of the money the firm saved as the result of the retail "realignment" last summer was reinvested--spent on advertising and technology. And while the company is re-examining the way it allocates resources, reducing paychecks for valuable employees is not the goal, he said. "In this highly competitive market for talented professionals, we are committed to attracting and retaining the best people to serve clients," Patrick said.

Merrill spokesman Eddie Reeves told RR that the number of FCs in Merrill's U.S. private client group increased to 16,000 producers at the end of the year, up 9% from 14,700 brokers at the end of 1999. A transcript of the comments made by Martin and Patrick during the conference call is available on Merrill Lynch's Web site. Or, click this link: client.nextvenue.com/mlir/4Q00_Earnings_Transcript.pdf. The press release detailing Merrill's full fourth-quarter results is also available on the firm's Web site, or, click here: www.ml.com/earnings/4q00erls.pdf. --Mike Hayes, Senior Editor

Editor's note: For any comments regarding this article, or to suggest a story idea for RR Online or Registered Representative magazine, contact Editor in Chief Dan Jamieson at dan_jamieson@intertec.com, Online Editor Rick Weinberg at rick_weinberg@intertec.com, Online Managing Editor Cheryl Cooper at cheryl_cooper@intertec.com or Senior Editor Michael Hayes at mike_hayes@intertec.com