Merrill Wealth Management's AI strategy: transforming client experience and advisor productivity
The latest New York edition of The Wealth Mosaic’s AI Toolkit roadshow featured an insightful keynote presentation by Nitesh Kadakia, Head of Innovation and Advisor Platforms at Merrill. The session explored how Merrill is leveraging artificial intelligence (AI) to enhance client experiences, mimimise risks, and improve adviser productivity.
AI as a pillar of Merrill Lynch’s strategy
Kadakia outlined Merrill Wealth Management’s high-level AI strategy and its approach to partnering with FinTech firms. He emphasised that ML’s AI efforts focus on three key objectives:
- Enhancing client experience – Providing personalized and efficient financial services.
- Reducing risk exposure – Utilising AI to mitigate financial and operational risks.
- Boosting Advisor Productivity – Equipping advisers with AI-powered tools to help scale their business and manage high-net-worth clients more effectively.
Real-life AI applications at Merrill Lynch
Kadakia highlighted several AI-driven use cases at Merrill, emphasising an iterative approach of applying, refining, and learning.
- Tax harvesting: ML’s AI-powered Insights program aids advisers in tax harvesting by identifying realised gains and offsetting unrealized losses. The machine learning (ML) model learns from adviser responses and provides timely recommendations, ensuring optimal tax strategies for clients.
- Transaction understanding: AI helps detect significant financial transactions, such as payments to contractors or interior designers, signalling potential home renovations. This insight allows advisors to proactively discuss liquidity needs with clients.
- AI-powered client support: The ‘ask Merrill®’ tool, introduced in 2014 and continuously enhanced, now has over 10,000 manually curated responses. It sits on Merrill’s large language model and integrates with ‘Erica®,’ Bank of America’s virtual assistant, to offer seamless AI-driven support for both advisors and clients.
The role of generative AI in Merrill Lynch’s future
Kadakia also shared Merrill’s vision for generative AI in wealth management. The firm has consciously decided to use AI for service-oriented tasks rather than sales-driven initiatives.
- Event notifications: AI is leveraged to notify advisors about significant client events, such as natural disasters, ensuring proactive engagement.
- Portfolio optimisation and investment research: summarise Bank of America research and earnings transcripts, making financial data more accessible and actionable.
Partnering with FinTechs: A balanced approach
Merrill does not solely develop AI solutions in-house but actively collaborates with FinTech firms.
- Selective partnerships: ML evaluates thousands of FinTechs annually to identify solutions that align with its digital and AI strategy.
- Client privacy and data security: Given the sensitive nature of financial data, Merrill prioritizes secure AI deployment to prevent inaccuracies and data breaches.
- Emerging technology considerations: While generative AI has demonstrated potential, it remains an evolving technology. Merrill continues to pilot new AI applications while ensuring compliance with security and governance standards.
AI governance, costs, and regulatory compliance
As AI adoption accelerates, Merrill has implemented robust governance measures to ensure responsible AI deployment.
- Cost considerations: AI infrastructure, including GPUs and servers, represents a significant investment. ML and BofA prioritizes AI use cases based on the opportunity (or problem to be addressed), scalability and return on investment (ROI).
- Regulatory oversight: Merrill engages in regular discussions with regulators and industry consortiums such as the OCC, SEC, SIFMA, and FINRA to ensure AI applications align with financial industry compliance standards.
- Energy consumption: The firm is conscious of AI’s environmental impact, considering carbon footprint implications when deploying AI technologies.
A lesson in resilience: AI and the unpredictability of innovation
Kadakia concluded his presentation with an analogy about his personal experience growing a lemon tree, which surprisingly bore limes instead. His takeaway: adaptability and resilience are essential when navigating emerging AI technologies. AI, much like his tree, requires patience, learning from failures, and an openness to unexpected outcomes.
Key takeaways and industry implications
Merrill is pioneering AI-driven innovation to enhance client engagement and adviser productivity. The firm’s structured approach – leveraging AI responsibly, partnering with FinTechs, and maintaining regulatory compliance – sets a precedent for the financial industry.
As AI technology continues to evolve, financial institutions must balance innovation with risk management, ensuring AI deployment aligns with client needs, regulatory standards, and long-term business goals. Merrill’s AI journey underscores the transformative potential of AI while acknowledging the challenges of cost, governance, and responsible growth.
Boilerplates:
Name: Nitesh Kadakia
Title: Head of Innovation and Advisor Platforms, Merrill
Company: Merrill, part of Bank of America
Email: Nitesh.Kadakia@ml.com
LinkedIn: https://www.linkedin.com/in/nitesh-kadakia-0b42491/
About the author:
Nitesh is the Head of Innovation and Adviser Platforms at Merrill, with a focus on enabling Data Intelligence. He and his team are responsible for the adviser experiences enabled through CEW, Salesforce, Adviser & Client Insights, and Fintech Innovation. He has been featured in the media for his views on Artificial Intelligence, including Generative AI, and represents Merrill on the Datos Insights Research Council. Prior to Merrill, Nitesh worked in wealth management consulting for several established firms including Capgemini, PWC, and Capco. Nitesh is based in NYC, married with an 11 year old daughter, and resides in Mountainside, NJ.
About Merrill:
Merrill, which is part of Bank of America Corporation, includes Merrill Wealth Management and Merrill Private Wealth Management and is a leading provider of comprehensive wealth management and investment services. Merrill specialises in goals-based wealth management, including planning for retirement, education, legacy, and other life goals. Merrill is one of the largest wealth management businesses in the world, with approximately $3.6 trillion in client balances as of December 31, 2024. Client balances consists of the following assets of clients held in their Merrill accounts, including assets under management (AUM) of Merrill entities, client brokerage assets, and assets in custody of Merrill entities, as well as loan balances and deposits of Merrill clients held at Bank of America, N.A. and affiliated banks.
