Rich Clients Want Lending. Merrill Lynch Is Ready for Them

What do the world’s wealthiest clients need most? Well, a loan, of course.

Merrill Lynch announced it was launching a new credit unit last week that will offer custom lending and loan management to high- and ultra-high net worth clients and their advisors. The firm’s lending platform has surpassed $10 billion in loan originations in under two years, and the private bank sees opportunity ahead with providing credit to the uber wealthy.

“It also allows them to further diversify their wealth and take advantage of trends in varying asset classes at differing times that are helpful to growing their balance sheets,” said Bank of America managing director Kurt Niemeyer, who will lead the new unit. 

Lend Me a Hand

The lending options are flexible, and clients will be able to borrow against a range of assets in their portfolios, including businesses, real estate, collectibles and even luxury items, like yachts, Niemeyer said. Wealthy clients will often use this type of credit to avoid disrupting their long-term investment strategies.

Today, America is home to roughly 23.8 million folks worth seven figures, a statistic that grew by more than 1,000 people a day in 2024, according to UBS’ latest global wealth report. By 2028, that number is expected to be roughly 25.5 million. As assets grow, so does the complexity for wealth management, and Merrill isn’t the only firm beefing up:

• Last year, Goldman Sachs told Reuters it aimed to double its lending over the next five years to ultra-wealthy private bank clients with account sizes exceeding $10 million.
• JPMorgan announced that it will also increase its direct lending commitment to clients to $50 billion earlier this year.

No Alternative Opinion. Merrill’s new lending unit comes shortly after the private bank announced the launch of an alternatives program that allows high- and ultra-high net worth clients to invest in institutional-grade private market funds. Basically, Merrill doesn’t want their top-tier clients looking anywhere else for any reason.