Merrill Lynch is set to stay in the Broker Protocol, setting the firm on a course that is sharply different than rivals Morgan Stanley and UBS, which recently exited the industry accord.

Doubts have swirled about the future of the protocol following the departures of Morgan and UBS. The protocol, created in 2004, permits advisors to take basic client contact information with them when they switch firms.

Upper management at Merrill heard about the news Monday morning from Andy Sieg, head of Merrill Lynch Wealth Management.

“While other firms are focused on leaving the Broker Protocol as a way of retaining advisors and clients, we’re staying focused on making sure that our advisors have everything they need to serve their clients and grow their businesses. We’re asking our advisors, in turn, to concentrate on two things: first, to help existing clients achieve their financial goals, and second, to acquire new client relationships. We continuously evaluate the competitive landscape, but we are not making plans to leave the protocol," Sieg said, according to a person familiar with the matter. The quote was confirmed by a company spokeswoman.

(Bloomberg News)

Merrill Lynch's decision carries weight because of its stature within the industry and because it has nearly 15,000 advisors.

"If Wells and Merrill stick with it, then I think it will survive," says Jeff Nash, CEO of Bridgemark Strategies, a consulting and recruiting firm.

Wells Fargo has previously declined to comment on whether it will stay in the protocol.

Merrill Lynch, Morgan Stanley and UBS have all cut recruiting efforts in the past year-and-a-half. Wells Fargo has continued to try to recruit aggressively.

In recent weeks, many industry insiders were trying to work out what a post-protocol recruiting landscape would look like. Some feared that broker moves would be weighed down by high litigation costs — a feature of the pre-protocol recruiting landscape.

Now, industry observers may have to figure out how a partial protocol world will shape up.

Nash suggests that non-protocol firms may resemble Edward Jones, which primarily trains fresh advisors rather than recruit talent from rivals, as much of the rest of the industry has done for years.

"If you're not in the protocol, then you're probably not recruiting protocol advisors," Nash says.