Compliance July 15, 2011

Puerto Rican Bank Settles Stock Drop Case

An $8.2 million settlement has been preliminarily approved by the U.S. District Court for the District of Puerto Rico in the consolidated class action lawsuit against Puerto Rico-based financial services firm, Popular Inc.
Reported by

Gainey & McKenna and Harwood Feffer LLP, the plaintiffs’ counsel, and Popular, Inc. announced that the settlement will be allocated to plan participants’ accounts who had investments in employer stock during the class period.  

The settlement class consists of all participants of the Popular, Inc. Puerto Rico Savings and Investment Plan and the Popular, Inc. U.S.A. 401(k) Savings & Investment Plan who held employer stock, as that term is defined in the plans, in their individual accounts at any time during the period starting on January 24, 2008, and ending on April 6, 2011.  

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A hearing is set for August 26 for final approval of the settlement.  

In May 2009, the Milberg class action law firm announced it was investigating possible violations of the Employee Retirement Income Security Act (ERISA) in its handling of the Popular, Inc. U.S.A. 401(K) Savings & Investment Plan by keeping company stock as a 401(k) plan investment option when it was no longer prudent to do so and by not fully disclosing its true financial condition to participants (see “Milberg Announces Puerto Rican Bank ERISA Probe“).

The Markets July 15, 2011

Excluding China, Asia Funds Do Well in May

Excluding China, long-term funds in Asia collected over $15 billion in net flows during May, according to data from Strategic Insight, an Asset International company.
Reported by

Japan led the way with $11 billion, followed by Korea ($1.9 billion), Hong Kong ($1.3 billion) and Taiwan ($1 billion). The smaller Southeast Asian countries collectively garnered $1.3 billion in new money for the month.   

In Japan, real estate funds were the clear winners for the month, taking in a net $4.6 billion. Bond high yield funds posted a $2.4 billion net inflow. The largest net outflow ($1.7 billion) was posted by funds in the bond global category.  

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In Hong Kong, equity Asia Pacific funds led the way ($709 million), followed by bond Asia Pacific ($604 million).  

In China, 20 new launches took in $6 billion in May, while existing funds were in net redemptions ($8.8 billion).  

Strategic Insight noted that China funds report assets on a quarterly basis, except for new fund IPOs. China monthly flows are adjusted in the quarter-end releases based on Strategic Insight’s proprietary research.  

More information is at http://www.strategicinsightglobal.com.

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