Putting clients first made us #1

Transcription

1 2013 DC Survey

2 percent of clients willing to recommend BMO 20percent historical client retention 20Best in Class awards #1 overall ratings more awards than the next competitor 2years in a row ranked #1 retirement plan provider Putting clients first made us #1 For the seventh year in a row, BMO Retirement Services was awarded more Best in Class awards in the PLANSPONSOR 401(k) DC Survey than any other provider, and we ranked higher than our peers in a wide variety of categories. Our clients say our highly personalized service and deep industry knowledge continue to set us apart from other providers, and we re gratified to have once again surpassed their expectations. Let us prove ourselves to you. We invite you to contact us today at: bmoretirementservices.com

3 Expertise in action Here s what our clients have to say about us: Excellent service responsiveness, knowledge and flexibility. We trust them. They are highly professional, work with integrity, and are extremely knowledgeable and current on industry trends. Participants have 24/7 access to a live person. BMO has a very user-friendly website and a customer service-focused call center always available to answer participant questions. Responses are quick, complete and thoughtful. I truly appreciate that extra effort and honesty. BMO Retirement Services bmoretirementservices@bmo.com bmoretirementservices.com Our participants consistently comment on how easy BMO is to work with and how their questions are answered promptly and accurately. Employee statements are informative and comprehensive, without being overwhelming. I find BMO s support to me (as a Plan Sponsor) to be outstanding! Everyone on the team is extremely service-oriented, prompt, accurate and courteous. I honestly couldn t ask for anything more from them. From compliance to education BMO does it all and is constantly responding to our needs. BMO s systems are easy to use, clear, understandable and efficient. Source: PLANSPONSOR Provider Reports

4 Determining the leaders in DC plan providers After years of consolidation in the defined contribution (DC) plan recordkeeping market, it appears that most of the remaining plan providers are in it for the long haul. Many services that were once only available through a select number of providers have become commonplace. Compared with 2012, average service levels are higher for every service category and for net recommendation rates, which rose from 58.5% in 2012 to 62.3% in In the 2012 survey, scores dropped in every service category from the 2011 data, potentially highlighting the influence external factors, such as market performance and the legal/regulatory environment, had on provider satisfaction. However, this year has seen good performance from the markets, encouraging news from the Fed and relative quiet in terms of regulations all perhaps leading plan sponsors to be generally happier with their plans and the services they receive from their providers. to the

5 Although service was up across the board, the survey results show that larger markets are harder to service than smaller markets. Increased plan size often brings complexity, and complexity brings more challenges to service. Service levels almost universally decline as asset levels grow, but the absolute drop in service is small (only about 6%). Overall plan sponsor satisfaction, though, shows a more significant drop at large plans, with the net recommendation rate ranging from 63.8%, at plans with between $5 million and $25 million in plan assets, to 28.7%, at plans with more than $1 billion in assets. In fact, the only segment in which a meaningful number of plan sponsors are unlikely to recommend their provider is that mega-market segment. Similarly, the number of respondents unwilling to recommend their provider doubles from the smallest plans (7.4% among plans with <$5 million in assets) to the largest plans (15.3% in plans with >$1 billion in assets). Commoditization of Services? While the range of scores for any given service attribute is fairly consistent, the average sponsor satisfaction with each service highlights some areas that are becoming commoditized and other areas that deliver lower satisfaction to sponsors. Overall, administrative services such as participant statements, range of investment options and transaction processing, as well as relationship-based services related to account or service teams, produce mean scores in excess of 6.40 on the survey s 7-point scale (91%). The best providers deliver nearly perfect administrative and customer service to sponsors (maximum scores >6.90, or 98.6%). Overall, more Best in Class awards were given for Account team knowledge (61) and Service team responsiveness (65) than for any other category. Conversely, products and services relating to education programs, along with sponsor websites and tools, have the lowest levels of satisfaction among sponsors, with the lowest mean and secondlowest minimum scores, respectively, in the survey. Categories receiving the fewest awards were On-site meetings (18), Overall education program (20), Communication materials (21) and Plan reporting/ benchmarking (21). Keep in mind that the minimum possible number of awards across all markets for these categories is 18. Reflection on these numbers shows that providers appear to be delivering exceptional administrative and self-service offerings on the participant side but fail Average Service Ratings 1=poor; 7=excellent PARtiCiPANt SeRviCeS Min. Mean Max Participant call centers Participant website functionality Online tools/investing services Participant statements Overall education program Communication materials Enrollment assistance Retiree services/payments On-site meetings Range of investment options Loan/Withdrawal processing Beneficiary administration Participant fee disclosure SPONSOR SeRviCeS Min. Mean Max Sponsor website and tools Plan reporting/benchmarking Form 5500 processing Compliance support/testing Legislative/Regulatory updates Account team knowledge Service team responsiveness Staff consistency Plan design flexibility Cost-to-value of plan fees Net Recommendation Score % % By Asset Size <$5mm 61.3% $5mm $25mm 63.9% >$25mm $50mm 60.2% >$50mm $200mm 57.0% >$200mm $1b 52.2% >$1b 28.7% Overall Service Scores Part Spnsr

6 with person-to-person services On-site meetings received the lowest minimum score in the survey. Perhaps this is a reflection of the feeling that meetings and education programs need to be revamped in order to get through to participants. On the sponsor side, though, the scores are flipped: Person-to-person offerings have higher scores while self-service solutions are lacking. Adviser Influence Many plan sponsors have turned to advisers to provide them support and assistance in the running of their retirement plans. According to the research, the presence of an adviser does little to improve a sponsor s perception of the recordkeeping provider s participant services; the average participant score is 6.24 for respondents both with advisers and without advisers. However, average scores for sponsor services and overall likelihood to recommend the DC plan provider both increase when advisers are present. Average sponsor scores increase from 6.28 to 6.31 with an adviser, and average recommendation rates increase from 91.6% to 92.3%. This may reflect the additional support the plan sponsor receives from the adviser or the possibility that advisers are able to lobby for better service for their plan sponsor clients from the DC plan provider. Pension Plan Relationship It appears that the presence of a defined benefit plan has only a minimal impact on a sponsor s perception of a provider s defined contribution recordkeeping services. Overall, sponsors with defined benefit plans had an average recommendation rate of 6.38, while those without these plans scored 6.45 a 1% difference. What is interesting, though, is the difference in defined benefit provider satisfaction based on the type of relationship. Overall likelihood to recommend scores among the sponsors that bundle defined benefit and defined contribution plans with the same provider were 6.53, compared with 6.00 for unbundled relationships i.e., defined contribution and defined benefit outsourced to different providers and 5.38 for internally administered defined benefit plans. And while recommendation rates vary significantly with defined benefit plan administration based on the defined contribution recordkeeping relationship, the corresponding recommendation rates for DC recordkeeping providers vary far less: 6.43 for a bundled provider vs for unbundled providers and 6.35 when defined benefit is handled internally. This suggests that the primary benefit of bundling plans with the same provider comes in the administration of the defined benefit plan. In the pages that follow, we show the vendors that stood out as Best in Class in the ratings they received from their plan sponsor clients in various sponsor and participant services, as well as individual profiles of 38 providers. Alison Cooke Mintzer and Brian O Keefe Top 10 Providers by Net Recommendation Score <$5MM in total PLAN ASSetS 1 Correll Co. 92.6% 2 The Newport Group 87.1% 3 DailyAccess Corporation 86.5% 4 BMO Retirement Services 82.8% 5 MBM Advisors Inc. 82.4% 6 The Standard 81.3% 7 BB&T Retirement and Inst Svcs 77.8% 8 Transamerica Retirement Solutions 75.0% 9 American Trust 74.1% 10 CUNA Mutual Group/CPI 73.6% $5MM $25MM in total PLAN ASSetS 1 BMO Retirement Services 91.4% 2 American Trust & Savings Bank 90.5% 3 Securian Financial Group 90.0% 4 MBM Advisors Inc. 86.4% 5 BB&T Retirement and Inst Svcs 82.1% 6 The Newport Group 80.0% 7 Transamerica Retirement Solutions 78.3% 8 SunTrust Bank 71.8% 9 DailyAccess Corporation 71.4% 10 MassMutual Financial Group 70.5% >$25MM $50MM in total PLAN ASSetS 1 Putnam Investments 87.5% 2 The OneAmerica Companies 85.7% 3 The Newport Group 82.6% 4 BMO Retirement Services 80.8% 5 Milliman Inc. 74.1% 6 Principal Financial Group 70.8% 7 VALIC 70.4% 8 Bank of America Merrill Lynch 65.2% % 10 Transamerica Retirement Solutions 59.5% >$50MM $200MM in total PLAN ASSetS 1 BMO Retirement Services 95.2% 2 Principal Financial Group 77.3% 3 The Newport Group 73.3% 4 Milliman Inc. 71.9% 5 New York Life Retirement Plan Svcs 69.6% 6 Transamerica Retirement Solutions 67.8% 7 MassMutual Financial Group 66.7% 7 Putnam Investments 66.7% 9 Bank of America Merrill Lynch 65.6% 10 VALIC 61.9% >$200MM $1B in total PLAN ASSetS 1 Bank of America Merrill Lynch 80.0% 1 Milliman Inc. 80.0% 3 TIAA-CREF 70.8% 4 VALIC 68.4% 5 Vanguard 68.0% 6 MassMutual Financial Group 65.0% 7 T. Rowe Price 63.2% % 9 Transamerica Retirement Solutions 51.9% 10 Great-West Financial 40.0% >$1B in total PLAN ASSetS 1 TIAA-CREF 64.3% 2 T. Rowe Price 58.3% 3 Bank of America Merrill Lynch 50.0% 4 Vanguard 45.5% % 6 Great-West Financial 33.3% 7 ING U.S. Retirement 30.8% 8 J.P. Morgan Retirement Plan Svcs 5.9% 9 Aon Hewitt 3.2%

7 2013 Best in Class Providers listed in the following tables qualified for awards by meeting the minimum number of client responses in the asset group (minimums are listed in each chart). In some cases, a provider received the minimum for the asset group but not for certain individual service categories in which case those boxes are indicated as ineligible. The three highest-scoring providers in each service attribute, as well as those with an average score above the asset group s benchmark score, earned Best in Class awards (benchmark scores are also listed in each chart). Also indicated are scores in the top quartile that failed to meet the benchmark score. PARtiCiPANt SeRviCeS SPONSOR SeRviCeS Participant call centers Website functionality Online tools/services Participant statements Education program Communication materials Enrollment assistance Retiree services On-site meetings Range of investments Loan/Withdrawal processing Beneficiary administration Participant fee disclosure Sponsor website/tools Plan reports/benchmarking Form 5500 processing Compliance support/testing Legislative/Reg updates Account team knowledge Service team responsiveness Staff consistency Plan design flexibility Cost-to-value of plan fees Plan Assets <$5MM (minimum of 25 responses; Best in Class benchmark of 93%) ADP Retirement Services American Trust Ascensus BB&T Retirement and Institutional BMO Retirement Services Correll Co. CUNA Mutual Group/CPI Qualified DailyAccess Corporation Great-West Financial Guardian Group Pensions ING U.S. Retirement John Hancock Retirement Plan Svcs MassMutual Financial Group MBM Advisors Inc. The Newport Group The OneAmerica Companies Principal Financial Group Professional Capital Services (PCS) The Standard SunTrust Bank Transamerica Retirement Solutions = Provider ineligible for Best in Class award = Top quartile score that did not win Best in Class award

8 PARtiCiPANt SeRviCeS SPONSOR SeRviCeS Participant call centers Website functionality Online tools/services Participant statements Education program Communication materials Enrollment assistance Retiree services On-site meetings Range of investments Loan/Withdrawal processing Beneficiary administration Participant fee disclosure Sponsor website/tools Plan reports/benchmarking Form 5500 processing Compliance support/testing Legislative/Reg updates Account team knowledge Service team responsiveness Staff consistency Plan design flexibility Cost-to-value of plan fees Plan Assets >$5MM $25MM (minimum of 20 responses; Best in Class benchmark of 93%) ADP Retirement Services American Trust Ascensus Bank of America Merrill Lynch BB&T Retirement and Institutional BMO Retirement Services CUNA Mutual Group/CPI Qualified DailyAccess Corporation Great-West Retirement Services ING U.S. Retirement John Hancock Retirement Plan Svcs MassMutual Financial Group MBM Advisors Inc. Milliman Inc. The Newport Group The OneAmerica Companies Principal Financial Group Putnam Investments Securian Financial Group The Standard SunTrust Bank TIAA-CREF Transamerica Retirement Solutions VALIC Wells Fargo = Provider ineligible for Best in Class award = Top quartile score that did not win Best in Class award

9 PARtiCiPANt SeRviCeS SPONSOR SeRviCeS Participant call centers Website functionality Online tools/services Participant statements Education program Communication materials Enrollment assistance Retiree services On-site meetings Range of investments Loan/Withdrawal processing Beneficiary administration Participant fee disclosure Sponsor website/tools Plan reports/benchmarking Form 5500 processing Compliance support/testing Legislative/Reg updates Account team knowledge Service team responsiveness Staff consistency Plan design flexibility Cost-to-value of plan fees Plan Assets >$25MM $50MM (minimum of 20 responses; Best in Class benchmark of 93%) Bank of America Merrill Lynch BMO Retirement Services Great-West Financial MassMutual Financial Group Milliman Inc. The Newport Group The OneAmerica Companies Principal Financial Group Putnam Investments Transamerica Retirement Solutions VALIC Wells Fargo Plan Assets >$50MM $200MM (minimum of 20 responses; Best in Class benchmark of 93%) Bank of America Merrill Lynch BMO Retirement Services Charles Schwab Great-West Financial ING U.S. Retirement MassMutual Financial Group Milliman Inc. The Newport Group New York Life Retirement Plan Svcs Principal Financial Group Prudential Retirement Putnam Investments TIAA-CREF Transamerica Retirement Solutions T. Rowe Price VALIC Wells Fargo = Provider ineligible for Best in Class award = Top quartile score that did not win Best in Class award

10 PARtiCiPANt SeRviCeS SPONSOR SeRviCeS Participant call centers Website functionality Online tools/services Participant statements Education program Communication materials Enrollment assistance Retiree services On-site meetings Range of investments Loan/Withdrawal processing Beneficiary administration Participant fee disclosure Sponsor website/tools Plan reports/benchmarking Form 5500 processing Compliance support/testing Legislative/Reg updates Account team knowledge Service team responsiveness Staff consistency Plan design flexibility Cost-to-value of plan fees Plan Assets >$200MM $1B (minimum of 15 responses; Best in Class benchmark of 90%) Bank of America Merrill Lynch Charles Schwab Great-West Financial ING U.S. Retirement J.P. Morgan Retirement Plan Svcs MassMutual Financial Group Milliman Inc. TIAA-CREF Transamerica Retirement Solutions T. Rowe Price VALIC Vanguard Wells Fargo Plan Assets >$1B (minimum of 10 responses; Best in Class benchmark of 90%) Aon Hewitt Bank of America Merrill Lynch Great-West Financial ING U.S. Retirement J.P. Morgan Retirement Plan Svcs TIAA-CREF T. Rowe Price Vanguard = Provider ineligible for Best in Class award = Top quartile score that did not win Best in Class award Asset International, Inc. All Rights Reserved. No reproduction or redistribution without prior authorization. For information: (203) or reprints@plansponsor.com.

11 BMO Retirement Services bmoretirementservices.com BMO Retirement Services is a part of BMO Global Asset Management. BMO Retirement Services is a part of BMO Global Asset Management and a division of the BMO Harris Bank N.A., offering products and services through various affiliates of BMO Financial Group. BMO Global Asset Management is the brand name for various affiliated entities of BMO Financial Group that provide investment management, retirement, and trust and custody services. Certain of the products and services offered under the brand name BMO Global Asset Management are designed specifically for various categories of investors in a number of different countries and regions and may not be available to all investors. Those products and services are only offered to such investors in those countries and regions in accordance with applicable laws and regulations. BMO Financial Group is a service mark of Bank of Montreal (BMO). Investment products are: NOT FDIC INSURED NO BANK GUARANTEE MAY LOSE VALUE BMO Financial Corp. All rights reserved. 3448C (2/14)