us transfer agent market report
DESCRIPTION
Report on the U.S. transfer agent market. Computershare emerges leaderTRANSCRIPT
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Copyright 2013 Group Five. All rights reserved. No part of this publicaon may be reproduced or transmied in any form or by any means without permission from Group Five. No adversing or other promoonal use can be made of the informaon
in this report without the express prior wrien consent of Group Five.
GROUP FIVE 2013 SHAREHOLDER SERVICES
INDUSTRY REPORT OCTOBER 2013
EighthundredtwoissuersparticipatedinGroupFives2013BenchmarkingStudyofSatisfactionwithShareholderServices.Thepurposeofthestudy,whichhasbeenconductedannuallyfortwentythreeyears,istoprovideindependentandunbiasedinformationonthesatisfactionofcorporateclientswiththeservicesprovidedbytransferagents,proxysolicitors,andlostshareholdersearchfirms.Thisreportisasummaryofthestudyresults.AdditionaldetailsandreportsareavailablefromGroupFive.
Fortransferagentservices,Computershare,thelargesttransferagencyintheworld,completedtheconversionofformerBNYMellonaccountstotheComputershareplatforminMay2013,makingComputershare,forthefirsttime,thelargestprovideroftransferagentservicesintheUnitedStates.TheTransferAgentMarketSharetableshowsapproximatecurrentmarketsharefortransferagentservicesintheUnitedStates.NeverbeforehastherebeenasingletransferagentoperationaslargeasComputersharesisintheUnitedStates.
Issuersatisfactionwithtransferagentservices*Thefiguresshowninthetablerepresentapproximately97%oftheUSregisteredshareholdermarket.**Afavorablerangisarangof4or5onafivepointscalewith5beingcompletely sasfied and1beingnot at all sasfied.
isunchangedfromlastyearat87%favorable.**However,clientloyalty,measuredaswillingnesstorecommendyourtransferagent,declinedsignificantlyfromlastyearto77%favorable.Thegapbetweenloyaltyandsatisfactionhasneverbeengreater.
Clientsatisfactionisanindicationofhowwellthetransferagentservicesaremeetingclientsneedsandexpectations,whichisabasicbusinessrequirement.Clientloyalty,ontheotherhand,ismoreameasureofaclientsemotionalconnectiontotheirtransferagentwhichcomesfromwithinandis
moreofafeelingabouttherelationshipingeneral.The4pointdeclineinindustryloyaltywhileindustrysatisfactionremainsunchangedispartlyaresultoftheComputershareacquisitionoftheBNYMellonbusiness.Ashappensineverymerger,BNYMellon
clientsemotionalconnectiontotheirtransferagentwasdisruptedandmustberebuilt.ThisisreflectedintherelativelyhighnumberofneutralloyaltyratingsforComputershareclients.Thegoodnewsisthatissuersatisfactionremainsrelativelyhigh.
TA Clients Accounts Marketshare*Accountsperclient
Computershare 6,100 26,345,340 61% 4,319WellsFargo 910 8,484,280 20% 9,323
AST 4,004 3,498,564 8% 929Broadridge 315 2,079,913 5% 6,603
CST 1,415 1,697,305 4% 1,200R&T 1,736 796,867 2% 459
USTAMS
878789
85
81 8184
90
77
81828382
76
80 79
2006 2007 2008 2009 2010 2011 2012 2013
TASOSL
Percen
tFav
orab
le
Sasfacon
Loyalty
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Copyright 2013 Group Five. All rights reserved. No part of this publicaon may be reproduced or transmied in any form or by any means without permission from Group Five. No adversing or other promoonal use can be made of the informaon
in this report without the express prior wrien consent of Group Five.
2013 SHAREHOLDER SERVICES INDUSTRY SATISFACTION REPORT
Shareholderservicesareacriticalelementofeverytransferagentsserviceoeringandfailuretoprovidesatisfactoryshareholderserviceseventuallyleadstoadeclineinloyalty.Thechartbelowshowsclientloyaltyandclientsatisfactionwithshareholderservices.Overthelastthreeyearstherehasbeenastatisticallysignificantdeclineinsatisfactionwithshareholderservicesalongwiththedeclineinclientloyalty.
studyrespondentswereaskediftheymeasureshareholdersatisfactionwiththeservicesprovidedbytheirtransferagent.Thepiechartbelowshowsthatonly25%ofrespondentssaidthattheydomeasureshareholdersatisfaction.Theaccompanyingbarchartshowsthatthoseclientswhodomeasureshareholdersatisfactionaresignificantlymoreloyalthanarethosewhodonot.Thedierenceisthatmeasuringshareholdersatisfactionbuildstrustintherelationship,whichinturnbuildstheemotionalconnectionwiththeclient.JackSundayexplains,Thesimplefactisthatthoseclientswhomeasureshareholdersatisfactiongetbetterservicethanthosethatdonot.
Thetableonthenextpageshowsasummaryofthe2013transferagentclientratingsforthefourlargestdomestictransferagentsreceivingover20responsestothestudy.NotshowninthetablearetheratingsforBroadridgeandContinentalStockTransfer,bothofwhichhavelessthan20responses.
WellsFargoShareownerServiceshasthehighestloyaltyratingforlargetransferagentsat83%favorable,whichissignificantlyabovetheindustryaverage.Registrar&Transferhasthehighestclientloyaltyamongmidsizetransferagentsat96%favorable.TheloyaltyofComputershareslegacyclientsisalsohighlyratedat81%favorable,howevertheloyaltyoflegacyBNYMellonclients,whoarenowwithComputershare,issignificantlylowerat64%favorable.Buildingloyaltyofclientsacquiredthroughamergertakestime.
CommentsfromafewWellsFargoclientsdemonstratetheemotionalconnectionbehindWellshighloyaltyratings.OneclientsaidTheteamdedicatedtoservicingourcorporateaccountisveryexperienced,accessibleandresponsive.AnothersaidOuraccountcontactsareterrific.Theyarealwaysaccessible,alwaysresponsive,andveryknowledgeable.
Similarly,commentsfromComputershareclientsemphasizedthepeoplesideofthebusiness.Itsallaboutyouraccountteam...wehaveanawesomeonewhowillkeepuswithComputershareformanyyearstocome,saidoneclient.AnothersaidWehaveverygoodservicefromouraccountmanagerandhetakesverygoodcareofus.Wewillreallymisshimifheeverleavesorretires.Heisalwaysquicktorespondandknowshisjobverywell.
Overallsatisfactionforthe27issuerswhoratedRegistrar&Transferis100%favorableandloyaltyis96%.Asoneclientstated,R&Tisagreattransferagentouraccountmanagerismostknowledgeableandalwaysavailabletous.
Thetableonthenextpageshowsthenumberofresponsesandpercentfavorableratingsforselectedelementsofthe2013studyforeachtransferagentandforeachmarketsegment.Themarketissegmentedbythesizeoftheregisteredshareholderbaseasshown.AdditionalinformationcanbeobtainedbycontactingGroupFive.
Yes25%
No75%
DYMSS?
TACL
Issuerswhodomeasureshareholder
sasfacon
Issuerswhodo notmeasureshareholder
sasfacon
81%
75%
Percentof
Respondents
Percentfavorableresponses
77
818283
82
79
76
80
87899089
80
7574
77
2006 2007 2008 2009 2010 2011 2012 2013
TASSSL
Percen
tFav
orab
le Shareholder Services
Loyalty
2
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Copyright 2013 Group Five. All rights reserved. No part of this publicaon may be reproduced or transmied in any form or by any means without permission from Group Five. No adversing or other promoonal use can be made of the informaon
in this report without the express prior wrien consent of Group Five.
2013TACSRIndustry American
StockTransferComputershare* Registrar&
TransferWellsFargoCPU LCPU LBNYM
AllIssuers
Responses 802 138 477 313 164 26 126
Loyalty 77 74 75 81 64 96 83
AnnualMeeng 96 90 97 99 93 100 96
Fees 82 83 79 81 75 96 86
Escheatment 86 82 87 88 86 100 83
Lessthan1,000
accounts
Responses 407 74 257 189 68 17 39
Loyalty 78 74 77 81 68
Lessthan20responses
87
AnnualMeeng 97 91 98 99 95 94
Fees 83 83 81 80 81 94
Escheatment 88 84 88 88 89 86
1,000to5,000
accounts
Responses 191 41 104 61 43 7 34
Loyalty 77 68 78 82 71
Lessthan20responses
79
AnnualMeeng 92 86 94 100 84 95
Fees 82 85 82 84 79 75
Escheatment 87 78 90 86 97 88
5,000to25,000accounts
Responses 105 11 57 26 31 2 32
Loyalty 76
Lessthan20responses
68 88 52
Lessthan20responses
78
AnnualMeeng 98 96 100 94 100
Fees 79 74 86 64 83
Escheatment 87 89 95 83 79
Morethan25,000accounts
Responses 95 12 59 37 22 0 21
Loyalty 71
Lessthan20responses
67 76 52
Lessthan20responses
86
AnnualMeeng 100 100 100 100 100
Fees 79 74 78 67 95
Escheatment 79 79 84 68 78
*ComputersharerangsareshownforallComputershareclients(CPU),legacyComputershareclients(LCPU),andlegacyBNYMellonclients(LBNYM).
2013 SHAREHOLDER SERVICES INDUSTRY SATISFACTION REPORT
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Copyright 2013 Group Five. All rights reserved. No part of this publicaon may be reproduced or transmied in any form or by any means without permission from Group Five. No adversing or other promoonal use can be made of the informaon
in this report without the express prior wrien consent of Group Five.
2013 SHAREHOLDER SERVICES INDUSTRY SATISFACTION REPORT
Aboutthestudy...The Group Five study of corporate opinions of shareholder servicesproviders is based on survey responses received from June throughSeptember2013.The sampleof companieswas taken fromGroup Fivesdatabases andpublic sources. All clients of themajor domesc transfer agentsweretargeted for the survey. At each company, the survey was to becompleted by the personmost familiar with the performance of thetransfer agent. Job tles of parcipants included Investor RelaonsDirector and Manager, Shareholder Relaons Manager, CorporateSecretary, CFO, President, etc. The completed study included 802responses from U.S. companies represenng from 100 to over onemillion registered shareholders, for a total of over 29 millionshareholders.Each issuerresponsereceivedequalweighngregardlessofthesizeoftheshareholderbase.Intheory, in95casesoutof100,overallresultsbasedonsuchsampleswilldierbynomore than threepercentagepoints ineitherdireconfrom what would have been obtained by asking all companies usingcommercial transfer agent services. The potenal sampling error forsmallersubgroupsislarger.Inaddiontosamplingerror,thepraccaldierencesofconducnganysurveycan introduceothersourcesoferror.Dierences inwordingandthe order of quesons, for instance, can lead to somewhat varyingresults.TheinformaoninthisreportshouldnotbeconsideredanendorsementofanycompanybyGroupFive.
GroupFive,85BolinasRoadSuite5,Fairfax,CA94930415.578.2388;[email protected]
Lostshareholdersearchservicesandassetrecoveryandreunificationservicesareanimportantelementofshareholderservices,andarebecomingmoreimportanteveryday.Thestudyalsoaskedcorporateissuerstoratetheirsatisfactionwithandtheirwillingnesstorecommendpostmergercleanup(PMC),lostshareholdersearch,andassetrecoveryandreunificationserviceproviders.ThreeserviceprovidersreceivedratingsinthestudyandforthefourthconsecutiveyearKeanehasthehighestratings.ThechartbelowshowstheoverallsatisfactionandloyaltyratingsforKeaneandtheindustryasawhole.
Corporateactionscanbeachallengeforissuersaswellasserviceproviderssinceeachoneisuniqueandoftenaretimecritical.Inthisyearssurvey178issuersratedtheirsatisfactionwiththeirtransferagentscorporateactionservicewith80%ofissuersprovidingafavorableratingforoverallsatisfactionand72%providingafavorableratingfortheirwillingnesstorecommendtheirserviceprovider.Thechartbelowshowstheoverallsatisfactionandloyaltyforcorporateactionsaswellastransferagentandlostshareholderservices.
Thetransferagentratingsfrom802issuersarerelativelyhighwhencomparedwithratingsforotherrelatedandunrelatedservices.Thespecificareasinwhichissuersratetransferagentshighestare:
datasecurityandprotection97%,proxyandannualmeetingmaterialsdistribution95%,
proxytabulation95%, recordkeepingaccuracy93%, accountsupportresponsiveness92%, accountsupportaccessibility92%.
Theareasinwhichissuersratetransferagentslowestinclude:
telephoneservicetoshareholders80%, reportaccessibilityonissuerwebsite80%, functionalityofissuerwebsite82%, functionalityofshareholderwebsite82%, clarityofshareholderformsandletters83%, shareholderfees84%.
78
80
93
63
Industry
Keane Sasfacon
PercentFavorable
Keane
PMC/LS/ARS
IndustrySasfacon
Loyalty
Loyalty
63
77
72
80
87
80
CSL
CorporateAcons
TransferAgent
LostAccounts
PercentFavorable
SasfaconLoyalty
SasfaconLoyalty
SasfaconLoyalty
4