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DOL Fiduciary News: February 1, 2017

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Principal CEO Says Company Ready for Fiduciary Rule as 4Q Net Rises 25%

Best's News Service via Bestwire -- January 31, 2017 04:44 PM

DES MOINES, Iowa -- Principal Financial Group posted a 25% jump in fourth-quarter 2016 earnings as its chief executive officer said the company balanced investments and growth with expense discipline.

Although there’s speculation there will be potential delays to the U.S. Department of Labor’s fiduciary rule update under the new administration, Principal Financial is prepared for an April applicability date, he said.

...The DOL rule would change the way insurance agents are regulated. Houston has said the DOL rule update was expected to cost Principal an additional $1 million a month over 18 to 24 months. Once it’s fully implemented, the annual operational cost associated with it is expected to be in the $5 million to $10 million range, he said at the time.

BofA’s Merrill to Tell Clients How They’re Paying Their Brokers

Bloomberg; January 31, 2017, 1:47 PM EST

Bank of America Corp., which has said it will stop offering commission-based retirement accounts as it prepares for new regulations, also plans to more clearly disclose fees that clients pay to the firm’s 14,000 financial advisers.

The Merrill Lynch business will break out fees for asset management services and products including mutual funds, alternative investments and commodities when it mails January account statements later this week. Such fees previously were embedded in statements in ways that customers found hard to understand.

Clients are likely to be more satisfied with “better fee transparency,” Susan McCabe, a company spokeswoman, said in a statement. “The enhancements are being made based on what our clients are telling us they’d like to see.”

Trump to Direct DOL to Delay Fiduciary Rule: Sources 

ThinkAdvisor; January 31, 2017

President Donald Trump is expected to issue this week an order directing the Department of Labor to delay its fiduciary rule, according to two attorneys familiar with the matter.

Trump appointed Edward Hugler as acting secretary of Labor on Jan. 20.

Hugler also has been serving as the acting assistant secretary of Labor for administration and management, leading the department’s presidential transition activities.

While the order issued this week by Trump will not delay the rule, it will direct Hugler to do so, according to one of the attorneys.

DOL fiduciary rule not yet caught up in Trump maelstrom

InvestmentNews; Jan 31, 2017 @ 1:07 pm

President Donald Trump has been the disrupter that he promised to be.

He is signing executive orders at a pace that makes former President Obama look desultory. His latest ones — on immigration and the makeup of the National Security Council — have sparked nationwide protests and bipartisan consternation on Capitol Hill.

But what Mr. Trump has not touched — so far — in this maelstrom is a Labor Department regulation that would raise investment-advice standards for retirement accounts.

When Mr. Trump was inaugurated, the financial industry had high hopes that delaying the DOL rule would be one of the first items that the new president addressed. It's now Day 10, and we haven't seen anything.

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