BofA Quotes as Much as $80,000 a User for Premium MiFID Research

(Bloomberg) -- Bank of America Corp. plans to charge asset managers as much as $80,000 a user annually for its research division’s full package of services when a European ban on free analysis for clients is imposed, according to a pricing document seen by Bloomberg News.

The premium package includes speaking directly to analysts, attending conferences and meeting senior executives of major companies and policymakers, according to the offer sent to clients on Tuesday. Clients opting for the premium offer will pay from $15,000 to $80,000 depending on how much they tap those services.

The bank’s New York-based spokeswoman Selena Morris declined to comment. Competitor Barclays Plc is asking clients to pay as much as 350,000 pounds ($450,000) for firm-wide access to its premium offer for equities.

Investment banks are locked in negotiations with money-manager clients over how to charge them for research once new European Union regulations known as MiFID II ban the free distribution of analyst notes and other services from 2018. The Markets in Financial Instruments Directive requires money managers to separate the trading commissions they pay from investment-research fees.

MiFID II Will Upend Investment Research. The Question Is, How?

Bank of America’s basic offer for so-called read only equity and fixed-income research will be far cheaper. Firms with fewer than 10 “active users” will be charged $6,000 a user. Those with more than 10 and up to 99 users will pay $5,000 and the biggest buyside clients will pay $4,000 per user, defined as individuals who “regularly access our platform for written content, equity models or global conference calls.”

Clients will be allowed a license for “occasional users” to access written research, according to the proposal.

UBS Group AG is proposing to charge clients about $40,000 a year to access basic equity research. Barclays is pricing its read-only European research at 30,000 pounds, while JPMorgan Chase & Co. is suggesting as little as $10,000 a year, the lowest price to emerge so far.

Bank of America is also planning to carve out separate prices for investors interested only in fixed income. It will charge $100,000 per firm for the “ultra high service” deal, which it expects to make available to just 30 clients, according to the proposal. A cheaper “limited service” offer will cost $15,000.

--With assistance from Nishant Kumar

To contact the reporters on this story: Tom Beardsworth in London at tbeardsworth@bloomberg.net, Trista Kelley in London at tkelley2@bloomberg.net, William Canny in London at wcanny3@bloomberg.net.

To contact the editors responsible for this story: Shelley Smith at ssmith118@bloomberg.net, Neil Callanan