Bankers win yet another battle
Regulations the Treasury has put together regarding distribution fees that the banks will be allowed to charge customers are to be brought this morning before the Knesset Finance Committee.
Antitrust Commissioner Dror Strum, Israel Securities Authority chair Moshe Terry and Finance Ministry legal counselor Yemima Mazuz all oppose the regulation the Finance Ministry has put together regarding distribution fees that the banks will be allowed to charge customers.
The regulations are to be brought this morning before the Knesset Finance Committee. Several Knesset members, who did not receive a copy of the regulations before the hearing, said they would object.
The Finance Ministry has yet to publish the regulations, which will lay out the distribution fees. However, figures obtained by Haaretz talk about fees of 0.8 percent for stock funds, 0.4 percent for bond funds and 0.25 percent for shekel funds.
These fees are higher than had been expected, but it became clear yesterday that the banks had won yet another battle. They succeeded in reclassifying some of the funds to a higher category, such that funds whose classifications were changed will need to pay higher distribution fees. This subject is a bit complicated, but it is the one that will determine which fund will be categorized as shekel-, bond- or stock-based.
According to information obtained by Haaretz, the banks managed to change even these regulations regarding fund classification. It seems likely that funds that were only to pay 0.25 percent will end up charging higher fees, and the same will be true for funds set to charge 0.4 percent fees. In other words, the regulations were published just a week ago, and the treasury has already altered them.
It turned out yesterday that in the Bachar committee hearings, Terry demanded that a unified distribution fee be set at a rate of 0.25 percent. Strum's objection was regarding the timing of when banks would be able to charge the distribution fees. Strum demanded that the starting date would be the day brokers would be allowed to sell funds without having to go through the marketing network of the banks. Strum also demanded a unified rate, albeit at 0.4 percent.
It now seems that, at least regarding the starting date, the treasury offered a compromise yesterday, according to which the starting date for paying distribution fees would only be on the day when brokers could sell mutual funds on their own.