Compliance August 20, 2008

MSRB Revises Series 51 Exam

The Municipal Securities Rulemaking Board (MSRB) said it revised its exam for 529 college savings plan dealers.
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The revisions feature a rebalancing of topics in the Municipal Fund Securities Limited Principal Qualifications Examination (Series 51). While no content will change, the weightings of subjects in the exam will better reflect developments in the market, the board said in a release.

While the MSRB doesn’t reveal details about the questions of its exams for obvious reasons, the release said the changes will cover categories such as product knowledge, sales supervision, and operations.

The revised Series 51 examination program will be implemented on November 1. The new version remains a 60-question test to be completed in 90 minutes, the MSRB said. Candidates for the Series 51 must also have passed the General Securities Principal Examination (Series 24) or the Investment Company Products/Variable Contracts Limited Principal Examination (Series 26), or they must take and pass either of these examinations concurrently with the Series 51 Examination in order to become a municipal fund securities limited principal.

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More information from the MSRB is available here.

Data & Research August 19, 2008

Rollover Market to Reach $500B in Five Years

A FRC report predicts that the market for assets rolled over from employer plans should approach $500 billion by 2013.
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The Financial Research Corporation (FRC) study said rollover totals should increase steadily from their 2007 levels of $260 billion. FRC said the rollover trend should present money managers with “significant retention opportunities.”

FRC said the rollover market presents the potentially rich market with chances of at least $40 billion per year in assets on the line for retention “and potentially much more for acquisition.”

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The agency said its findings are derived from a combination of FRC’s repository of IRA research, proprietary and third-party quantitative data—including the FRC Rollover 2008 Recordkeeper Survey—and FRC’s Rollover 2008 Asset Manager Survey. Additionally, FRC said the findings are based on numerous interviews with executives at financial services firms.

In this latest study, FRC evaluated distribution platforms and assessed the involvement and impact of asset managers in capturing and retaining rollover assets.

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