Bank of America: profiting from the mega-rich

The rich are getting richer, right? Well, if so, it should be a good idea to invest in money management services for the mega-rich.

At least that was the theory when Charles Schwab (NASDAQ:SCHW) purchased US Trust in 2000 for about $2.9 billion. Interestingly enough, Schwab is now selling this division to Bank of America (NYSE:BAC) for about $3.3 billion.

US Trust has a venerable history, getting its start in 1853. No doubt the firm's stability is a great attraction to its high-net worth clients.

However, this market is highly competitive, with other big-names such as Citigroup (NYSE:C) playing a major role.

As for Bank America, the deal gets them a bigger presence quickly, as well as a great brand. Keep in mind that on average an US Trust client has about $60 million under management. It also has a number of billionaire clients, and is the fourth largest manager of private wealth in the U.S.

Basically, it was tough for Schwab to provide the kind of services the mega rich want -- such as hedge funds, private equity and even IPOs. For Bank America, which is the second largest manager of private wealth in the United States, this should not be a problem.

Tom Taulli is the author of various books, including the Complete M&A Handbook and operates InvestorOffering.com.