Do TARP exits mean more BofA poaching?

Large rivals repaying government funds from the Troubled Asset Relief Program could turn into a nightmare for Bank of America Corp. (NYSE:BAC). BofA's rivals could lure away top performers from the institution, which is already fighting off talent raids of Merrill Lynch & Co. bankers.

The integration of BofA and Merrill may be proceeding apace and adding to the bank's bottom line, but culture clashes between the Wall Street centered "Thundering Herd" and their more conservative North Carolina brethren haven't gone away either. With BofA still facing compensation restrictions from the TARP program, top talent on both sides may now be seeking greener grass at competitors. So far J.P. Morgan Chase & Co. (NYSE:JPM), Morgan Stanley (NYSE:MS), BB&T Corp. (NYSE:BBT), Goldman Sachs Group Inc. (NYSE:GS) and U.S. Bancorp (NYSE:USB) have repaid TARP money.

BofA-Merrill isn't sleeping on the problem though. The bank is doling out significant sums to either attract or retain high-profile bankers. Investment bankers Fares Noujaim and Harry McMahon received retention bonuses to stay onboard. Noujaim, recently appointed vice chairman of investment banking, may have been offered at least $5 million more to stay, according to the New York Post.

In addition to compensation, BofA is getting its lawyers into the picture to scare off poachers. In March the bank sued Deutsche Bank AG (NYSE:DB), claiming the Frankfurt bank improperly raided Merrill's investment banking unit by taking bankers that generated tens of millions of dollars in annual revenues, namely a dealmaking dozen led by Eric Heaton. - George White

See Dealwatch on BofA/Merrill talent exodus
See Dealscape post TARP repayment
See NY Post story
See Dealscape post on Deutsche Bank lawsuit
See Dealscape post on Deutsche Bank departure of dealmaking dozen

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