Category: Financial Intermediary Administration

Financial Intermediary Oversight: What the industry is focused on in 2015


Financial IntermediaryAdministrationIdentifying trends and gaining industry insight are key factors in helping Boston Financial continue to evolve and better service our clients. One of the ways we do this is through our annual Financial Intermediary Administration (FIATM) survey of mutual fund company clients. Boston Financial introduced the FIA product suite in 2012 to help fund companies manage the operational and oversight activities of their financial intermediary relationships. The survey is intended to provide valuable intelligence as to what the industry is doing relative to intermediary oversight.

There were four key highlights that emerged from this year’s survey:

  • Risk – Nearly all survey respondents cited legal/regulatory as a risk faced related to intermediary based shareholder activity. Most companies also identified financial risk and reputational risk.
  • Oversight Program Staffing – In most cases intermediary oversight programs are staffed by existing resources. More than half of respondents (56%) indicated that all oversight functions are performed by existing resources and an additional 31% use a combination of existing and dedicated resources.
  • Board Focus – An overwhelming number of fund companies (71%) indicated that their boards have increased their attention on their intermediary oversight program over the past year.
  • Sub-Accounting Fees – More than half of the survey participants indicated that their evaluation of sub-accounting fees has evolved.

Fund companies continue to build intermediary oversight programs. Overall, 94% of fund companies have a formal program in place, up from 88% last year. However, satisfaction levels remain flat. In 2015, 41% indicated they were satisfied with their current program, compared to 47% last year.

You can read more on the key findings from the survey here. Please feel free to reach out to me with any questions.

Ken Larsen

Ken Larsen

Ken is a Vice President at Boston Financial with responsibility for the strategy of the Financial Intermediary Administration (FIA) products and services. These offerings include a suite of tools designed to assist broker-dealer distributed fund companies in the oversight and servicing of their third-party relationships. The FIA team provides fund companies with innovative solutions and support to their financial intermediary, trust, and retirement business relationships. Ken's career in the transfer agent business spans the U.S., U.K., and European marketplaces. He began his career at Fidelity Investments in Boston. For the last 24 years, he has worked for several third-party transfer agents including Boston Financial, IFDS (UK), and State Street Bank Luxembourg in operational, management, relationship and product development roles. Ken received his Bachelor of Science degree from Providence College.

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