HomeMy WebLinkAbout2007 03 08 Handout Regarding Fifth Third Global Securities Services
March 8, 2007
HANDOUT GIVEN TO THE
BOARD OF TRUSTEE
MEMBERS AT THE SPECIAL
MEETING ON MARCH 8, 2007.
~ Fifth Third Bank
IIIE.J Investment Advisors
Custody Services Proposal
City of Winter Springs Retirement Fund
March 8, 2007
Fred Johnston
Vice President & Institutional Trust Sales
Fifth Third Bank
Investment Advisors
(407) 999-3052
Kimberly Kutlenios
Vice President
Fifth Third Bank
Investment Advisors
(407) 999-3027
Agenda
. Organizational Overview
. Custody Services
. Internet Workstation
. Service T earn
. Schedule of Fees
&lilt Fifth Third Bank
IIIE.J Investment Advisors
Fifth Third Bank
Organizational Overview
Fifth Third Bank, Leader in Custody and Global Securities Services
· Founded in 1858 with headquarters in Cincinnati, Ohio
· 10th Largest financial institution in the United States
· Over 100 Florida banking locations and more than $7 billion in assets
· Moody's Aa2 senior debt rating for financial safety and soundness
· Over 80 years of custody experience
· $200 billion in assets under care
· Provider for over 500 institutional custody relationships (nearly 2,000 accounts)
~ Fifth Third Bank
fIIE.J Investment Advisors
2
Institutional Custody Overview
· Premier provider of custody and securities related services
· $200 Billion in assets under care
· Clients located in 38 states and internationally
Markets Served
· Public Funds
· Defined Benefit Pension Plans
· Taft-Hartley Plans
· Corporations
· Registered Investment Advisors (RIA's)
Public Funds Focus
· Insurance Companies
· Trust Companies
· Bank Safekeeping
· Mutual Funds
· Not-for Profit Organizations
· Over $60 billion in custody for government organizations
· A dedicated group of professionals providing comprehensive financial services to government organizations
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IIIE.J Investment Advisors
3
Representative Client List
· City of Naples
· Melbourne Firefighters' Retirement Trust System
· Melbourne General Employees' Retirement Trust System
· St. Augustine Firefighters' Pension Trust Fund
· South Pasadena Firefighters' Retirement System
· Gulfport Police Officers' Trust Fund
· Lake City Municipal Firefighters' Trust Fund
· Tamarac General Employees' Pension Trust Fund
RJIIt Fifth Third Bank
IIIE.J Investment Advisors
4
Custody Services Capabilities
· Safekeeping of investment portfolio
· Direct membership in all major depositories
· Global custody and trade settlement in over 101 markets worldwide
· Accurate, timely income collection
· Online access to account information
· Online delivery of corporate actions
· Proxy processing
· Automated mutual fund trading and income processing direct to NSCC through the Matrix Clearing &
Settlement System
· Consolidated plan reporting (monthly, quarterly, annually)
RI't Fifth Third Bank
IIIE.J Investment Advisors
5
Depository Memberships
Fifth Third Bank participates in all major depositories, either as a direct member or through our sub-custody
network and can settle trades in 101 markets around the globe.
Automated interfaces with these depositories ensure reconciliation without manual intervention or paper transfer.
The depositories include:
· Depository Trust & Clearing Company (DTC)
· Federal Reserve Bank
· National Securities Clearing Corp (NSCC)
· Euroclear
· Clearstream
· Global network of physical locations in over 101 markets worldwide
On a daily basis, Fifth Third settles 5,370 trades worth $6.10 billion.
&lilt Fifth Third Bank
IIIE.J Investment Advisors
6
Online Reporting: Internet Securities Workstation
Custom Reporting through the Web
~~"'I-I-
· Quick Internet access
. Proprietary internet-based system
· Real-time reporting
· Flexible reporting - full customization
. Online statements available 1st business day
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IIIE.J Investment Advisors
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Accounting & Reporting: Internet Securities Workstation
· Standard reports
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Account holdings listed by account
Affi~med T~ades
Trades affirmed for settlement list~~__~?_~count
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Help
RIft Fifth Third Bank
MJ InvestmentAdvisors
8
City of Winter Springs Relationship Team
Jeffrey Julius
Fifth Third
Product Specialist
Rich Machala
Fifth Third
Client Service Representative
Matthew Hoffman
Fifth Third
Conversion Manager
~ Fifth Third Bank
IIIE.J Investment Advisors
9
Conversion and Transition
Dedicated team of professionals to ensure that all conversions are smooth and seamless.
· Experience
Our transition team is comprised of specialists who possess vast knowledge and experience from two perspectives.
They have facilitated numerous institutional custody transitions during their tenure at Fifth Third Bank and
average over 10 years experience in securities processing.
· Key Coordinator
Each transition is assigned a dedicated Coordinator to serve as the customer's primary point of contact for the
implementation process. The Coordinator also maps and monitors all aspects of the transition from pre-conversion
planning to post-conversion reconciliation. Their role is to make the process as easy and efficient as possible for the
customer - having coordination and communication centralized with one contact from Fifth Third Bank.
· Communication
Communication is a key element to a successful transition. We coordinate conference calls and correspondence
(fax, mail and electronic mail) well in advance of the anticipated transition date. We prepare a pre-conversion
package containing all pertinent information needed by the customer. One important component of the package is
a customized, step-by-step transition plan detailing all tasks and due dates applicable to implementation. This
document is updated and distributed throughout the process to give the customer a current progress report.
RfIt Fifth Third Bank
It1IE.J Investment Advisors
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Client Service Team
Relationship Manager
A Relationship Manager is responsible for ensuring all service needs are fully met to client expectations.
This includes general operation of the accounts, on-site visits, product and technology development and
customer satisfaction. Operating in a consultative role, this professional serves as a client advocate and
liaison to Fifth Third. The average number of years experience in the industry exceeds eight, and most are
licensed and/or certified industry professionals.
Custody Service Specialist
A Client Representative works with all daily transactions and activity. This includes cash balance
reconciliation and projections, answering operational inquiries and working with third party brokers and
advisors. This person is part of a larger team and serves as the primary point of contact for trade
settlements, income collections, corporate actions processing, and any other securities related activity.
Technology Support Services
To support client interfaces and the 5/3 Internet Securities Workstation, a technology professional within the
Institutional Client Group is assigned to each client service team. This individual is readily available to
assist with any technology inquiries or trouble shooting questions our clients may have.
Transition Manager
Our Transition Team is called upon to assist and oversee any transitions, from the initial conversion of
portfolios to expansions or changes in account structure. Depending on the specifics of the transition,
experts in account conversions and project management methodologies corne together to provide support to
the Relationship managers and their clients.
&:lit Fifth Third Bank
WE.J Investment Advisors
11
Schedule of Fees
Custody Services
. 5 basis points on the market value of assets (excluding sweep vehicle) with an annual
minimum of $4,000
This fee includes safekeeping, trade settlement, asset receipts & delivery, wire transfers,
corporate actions, pension payments and access to the Internet Securities Workstation. There
are no set-up or conversion fees for the assets transferred from another bank.
Sweep vehicles:
Institutional Money Market Fund
Institutional Government Money Market Fund
us. Treasury Money Market Fund
Municipal Money Market Fund
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I1tIE.J Investment Advisors
12
Value added Services: Directed Brokerage
Fifth Third offers a Directed Brokerage/Commission Recapture program for Institutional Clients
.
Assures best execution capability for trading in US domestic equities and fixed income markets
.
Multiple domestic exchanges and order execution systems
.
Commission schedule is competitive and flexible enough to meet various order sizes
.
Commission Recapture available to Institutions to offset qualified expenses
.
Added efficiency of in-house settlement of trades to reduce time allocates to trade resolution problems
.
Real-time On-line Internet trading capabilities route trades directly to exchanges for efficient execution
.
Fifth Third retains NFS as agent to settle and clear all trades for Fifth Third Securities, Inc.
.
NFS is not a market maker; therefore, they have no interest in profits that may be made in the market making activity.
.
This keeps NFS from having a conflict of interest. As a matter of practice, NFS routes the trades to various market
makers that they believe will provide the "Best Execution" available. These market makers (about 31 in all) are
constantly monitored to ensure that they are providing the best execution. NFS modifies their routing tables
accordingly to provide the best service.
RI't Fifth Third Bank
IIIl.J Investment Advisors
13
Why Fifth Third?
· Superior custody services & administrative expertise
· Tailored solutions to fit the Town of Jupiter
· Local relationship servicing
· Corporate strength
· National presence
RfII Fifth Third Bank
I1IE.J Investment Advisors
14
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Fifth Third Presenters
Fred Johnston
Vice President & Institutional Trust Sales
Fred has joined the Investment Advisors team in Florida and will be working to develop and sell Institutional Trust
business. He will be covering all three Florida Affiliates from his Orlando office. The Institutional product set
includes, the Retirement Advantage 401(k) program, the Retire 53 product, Institutional Custody Services, and
Institutional Investment Management Services for the $10,000,000 and below segment of the market.
Fred has an extensive background in the Institutional Trust business beginning his career in 1978 in Pennsylvania.
Most recently he spent 5 1/2 years with AmSouth Bank supporting the Central Florida market. He is a member of the
Central Florida Employee benefits council.
Kimberly Kutlenios
Vice President & Senior Relationship Manager
Kimberly has over twenty five years of experience in the Investment Advisor area serving as Senior
Relationship Manager for institutional accounts. She joined Fifth Third Bank in April of 2005. She serves as
administrator for investment management accounts, retirement plans, custodial accounts, endowments and
foundations. Kimberly has a Certified Retirement Plan Specialist (CRSP) designation. She is an active
member of Central Florida's Employee Benefits Council where she has served several years as a board
member and is serving as Past President for 2006. She is a graduate of Salem College in Winston-Salem,
North Carolina.
RI't Fifth Third Bank
IIIE.J Investment Advisors
16
. INSTITUTIONAL MONEY MARKET FUNDS
Institutional Shares (Minimum Investment $5 Million) I Fourth Quarter 2006
{JDFifth Third Funds
Institutional Money Market
Fund
. NAIC Approved
. S&P Rating: AAAm
. Moody's Rating: Aaa
The fund seeks stability of principal and
current income. The fund invests
primarily in high-quality commercial
paper and other money market securities.
Ticker LSIXX
Cusip 31678R700
Current Yield (%) (As of 12/31/06)
7-Day Effective Yield 5.29
7 -Day Average Yield 5.16
30-Day Effective Yield 5.27
30-Day Average Yield 5.14
Portfolio Characteristics
(As of 12/31/06)
Total Net Assets $1,714,798,811
Average Weighted Maturity 50 days
For more information about this fund's ratings, please refer to the Risks and Additional Information
section on the back of this page.
Avg. Annual Total Returns (%) (As of 12/31/06)
1.30
4.95
4.95
3.10
2.42
3.11
4/11 /00
4/11/00
Year to Date
Year
Years
Five Years
Sin5{!1rl~E!P~()~_. _~____.
~erf()rrl1al1~{!.~nE{!Pti()n Da!~
Fund Inception Date
Institutional Government
Money Market Fund
. Fitch Rating: MANl +
. NAIC Approved
. S&P Rating: AAAm
. Moody's Rating: Aaa
The fund seeks current income and
stability of principal. The fund invests
primarily in short-term, U.S. Government
securities.
Ticker KGIXX
Cusip 31678R502
Avg. Annual Total Returns (%) (As of 12/31/06)
1.29
4.88
4.88
3.03
2.28
3.58
6/2/97
6/2/97
Current Yield (%) (As of 12/31/06)
7-Day Effective Yield 5.23
7-Day Average Yield 5.10
30-Day Effective Yield 5.21
30-Day Average Yield 5.09
Portfolio Characteristics
(As of 12/31/06)
Total Net Assets $700,083,882
Average Weighted Maturity 43 days
For more inforrnation about this fund's ratings, please refer to the Risks and Additional Inforrnation
section on the back of this page.
Avg. Annual Total Returns (%) (As of 12/31/06)
1.28
4.80
4.80
2.95
2.20
3.56
Date 12/12/88
Inception Date 12/12/88
Year to Date
One Year
Three Years
Five Years
~.l1~{!Jl1.c_e.ptiQl1_ ._____~__....
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Fund Inception Date
u.s. Treasury
Money Market Fund
. Fitch Rating: MANl +
. NAIC Approved
. S&P Rating: AAAm
. Moody's Rating: Aaa
The fund seeks current income and stability
of principal. The fund invests primarily in
short-term, U.S. Government obligations
and repurchase agreements that are fully
collateralized by such Treasury securities.
Ticker FQTXX
Cusip 316786508
Current Yield (%) (As of 12/31/06)
7-Day Effective Yield 5.03
7-Day Average Yield 4.91
30-Day Effective Yield 5.16
3D-Day Average Yield 5.04
Portfolio Characteristics
(As of 12/31/06)
Total Net Assets $1,172,989,266
Average Weighted Maturity 21 days
For more information about this fund's ratings, please refer to the Risks and Additional Information
section on the back of this page.
Avg. Annual Total Returns (%) (As of 12/31/06)
0.87
3.32
3.32
2.09
1.63
2.27
9/7/83
9/7/83
Year to Date
One Year
Years
Five Years
Ten Years
_._--~_..._~-~...-
Performance
In~ep!ion Date
Municipal
Money Market Fund
The fund seeks current income that is
exempt from federal income tax, while
preserving capital and maintaining
liquidity. The fund invests primarily in
high-grade, short-term municipal bonds
and notes, general obligation bonds,
revenue bonds, and industrial
development bonds.
Ticker FXIXX
Cusip 316786706
Date
Current Yield (%) (As of 12/31/06)
7-Day Effective Yield 3.83
7-Day Average Yield 3.76
30-Day Effective Yield 3.57
30-Day Average Yield 3.51
Portfolio Characteristics
(As of 12/31/06)
Total Net Assets $295,798,302
Average Weighted Maturity 28 days
Special Consideration: The fund's income may be subject to certain state and local taxes and,
depending on an investor's tax status, the federal alternative minimum tax.
Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower
or higher. To obtain performance information current to the most recent month end, visit www.fifththirdfunds.com.
The yield quotation more closely reflects the current earnings of the fund than the total return quotation.
This material is authorized for distribution to prospective investors only when preceded or accompanied by the fund's prospectus, which contains
facts concerning the fund's objectives and policies, management fees, expenses and other information. Should you have any questions concerning
the information contained on this sheet, contact us at 1-800-282-5706 or visit www.fifththirdfunds.com. Please read the prospectus carefully
before investing.
NOT FDIC INSURED - NO BANK GUARANTEE - MAY LOSE VALUE
. INSTITUTIONAL MONEY MARKET FUNDS
Institutional Shares (Minimum Investment $5 Million) I Fourth Quarter 2006
iJDFifth Third Funds
Portfolio Composition
Institutional
Money Market Fund
Corporate Securities 34.5
Variable Rate
Demand Notes 25.1
Commerical Paper 21.8
Other 9.4
Certificates of
Deposit 7.5
Government & Agency 1 .7
(%) Portfolio composition is subject to change.
Institutional Government U.S. Treasury
Money Market Fund Money Market Fund
Municipal
Money Market Fund
Cash Equivalents 87.2
I
Variable Rate
- Demand Notes 88.1
-.
~MuniciPal
Securities 9.7
Commercial
Paper 2.0
Variable Rate
Demand Notes 25.1
Government and
Agency 12.8
Maturity Schedule (%)
Institutional
Money Market Fund
1.7
35.1
i:: 8-30
0:
2 31-60
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21.9
11.5
19.2
Institutional Government
Money Market Fund
U.S. Treasury
Money Market Fund
Municipal
Money Market Fund
1-7
34.5
1-7
87.3 1-7
'Xl.4
8-30
8-30 0.0
8-30 0.0
29.2
31-60 3.4
31-60 0.6
61-90 0.0
61-90 0.0
91-120 0.8
121-180 0.0
91-120 1.3
121-180 3.8
>180 4.2
>180 8.0
0% 10% 20% 30"/0 4()% 50% 60% 70% 80"/0 90%
0% 10% 20% 30% 40",(, 50% 60% 70"/0 80'\'0 90%
0% 10% 20"/" 30"", 40% 50"/0 60% 70% 80% 90%
0"/0 10% 20% 30% 40"/0 50% 60% 70% flO% 90%
Investment Approach
Our fund managers buy securities
that -
. Meet our stringent standards
for safety and stability
. Offer attractive relative value,
compared to similar types of
securities
Sell Discipline
Because they hold very short-
term securities, money market
funds do not trade their holdings
as actively as stock and bond
funds do. However, we consider
selling a security in one of our
portfolios if-
. We see an opportunity to
rotate into a more attractive
security
. We need to rapidly extend or
shorten a portfolio's average
maturity
. We have concerns about the
financial stability of a
corporation from whom we
bought commercial paper
1-IMMF4Q06
Risks and Additional Information
An investment in the fund is neither insured nor guaranteed by the FDIC or any other government agency.
Although the fund strives to maintain the value of your investment at $1.00 per share, it is possible to lose
money by investing in the fund.
The 7 -day yield is as of 12/31/06.
The fund inception date and performance inception date for the Institutional Money Market Fund
Institutional Shares is 4111100. Fund inception date and performance inception date for the Institutional
Government Money Market Fund Institutional Shares is 6/2197. Fund inception date and performance
inception date for the u.s. Treasury Money Market Fund Institutional Shares is 12112/88. Fund inception
date and performance inception date for the Municipal Money Market Fund Institutional Shares is 917/83.
A Fitch Rating of AAA/V1 + is assigned only to money market funds or local government investment pools
that should not experience loss of principal value to shareholders or participants even in severely adverse
interest rate environments.
The fund is on the NAIC List of Approved Mutual Funds. As a Class 1 listing it can be reserved against as if
it was an NAIC-1 Bond and is exempt from NAIC reserve requirements. The listing allows the fund to be
reported on Schedule DA Part 1.
The fund is rated AAAm by Standard & Poor's. This rating is historical and is based upon the fund's credit
quality, market price exposure and management. It signifies that the fund's safety is excellent and that it has
a superior capacity to maintain a $1.00 net asset value per share. S&P 500 is a registered service mark of
Standard and Poor's, a division of the McGraw-Hili Companies, Inc., which does not sponsor and is in no
way affiliated with the fund.
The Moody's Aaa money market fund rating reflects the high quality and conservative maturity profile of the
fund's investments which, in turn, contribute to its liquidity.
The 7-Day Effective Yield includes dividend reinvestment; the 7-Day Average Yield does not include
dividend reinvestment. Yields are as of 12/31/06.
The 30-Day Effective Yield includes dividend reinvestment; the 30-Day Average Yield does not include
dividend reinvestment. Yields are as of 12/31/06.
The Fifth Third Funds are distributed by Fifth Third Funds Distributor, Inc., 3435 Stelzer Road, Columbus,
OH 43219-8003, which is not affiliated with Fifth Third Bank. Fifth Third Asset Management, Inc. serves as
Investment Advisor to the Fifth Third Funds and is paid a fee for its services.
Advised by:
lilT A M
FIFTH THIRD ASSET MANAGEMENT