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 policy makers, according to the offer sent Tuesday to clients. 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 has quoted some small and medium-sized clients £350,000 ($450,000) for firmwide access to its premium offer for equities. The fees being quoted by researchers vary widely, with larger firms typically paying more.
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.
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, while J.P. Morgan Chase & Co. is suggesting as little as $10,000 a year, the lowest price to emerge so far.
"We are scratching our heads over what to pay and whether the research is really worth what the sellside wants," said Nicolas Roth, co-head of alternative assets at Geneva-based Reyl & Cie. "Ultimately, having to pay for research will be a good way to clean our inboxes and receive less email we never read."
Bank of America's basic offer for so-called read only equity and fixed-income research will be far cheaper than the premium service.
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 a 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.
Bank of America is also planning to carve out separate prices for investors interested only in fixed income. It will charge $100,000 a 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.