BPAS Firm Update

Partner Conference 2014

BPAS Firm Update and Conference Objectives

Barry KublinPresident, BPAS


BPAS Firm Update and Conference Objectives• Welcome, BPAS Partners Conference• Thank You!

– YOU – for partnering with us to provide retirement plan services to our mutual clients

– YOU – for joining us in a 3-day learning experience to improve our businesses and the effectiveness of the services we provide

– YOU – for engaging in a critical discussion of our industry and re-examining how we might partner to improve the retirement income readiness of working households

– Guest speakers, for sharing your knowledge– BPAS Marketing staff, for a first-class effort


BPAS Firm Update and Conference Objectives

• Conference Objectives– Update on BPAS Firm Capabilities– Strategies to compete in today’s 401k/403(b) marketplace– Business opportunities beyond the traditional 401k/403(b)

marketplace– Regulatory updates– Contemporary Investment Management Issues– Interactive sessions to discuss best practices among Partners


BPAS Firm Profile

• BPAS was founded in 1973 (41 years old)– If you knew of us, you might not know us today!

• 9 offices (3 Upstate NY, NYC, NJ, Phil, Pitt, Houston, San Juan)• 240 professionals• 3,600 clients• 350,000 participants• $16 billion assets under custody


BPAS Firm Profile

• Advanced DC Plan Administration– ESOP, KSOP– 401(k), 403(b), 457 municipal– 457, 409A non-qualified– Taft-Hartley, Prevailing Wage – MEP, MET– 1081 (Puerto Rico)

• Defined Benefit Plans— Mid-market traditional and

cash balance — Small-market cash balance


BPAS Firm Profile

• VEBA/HRA– Voluntary Employee Beneficiary Association/ Health

Reimbursement Accounts• Funded post-retirement medical benefits• Taft-Hartley (IBEW, USWA)• Public Sector (Northwest Firefighters Association)• UAW VEBA is the largest direct holder of GM stock (8.8%)

– Health and Welfare Benefits• Actuarial valuation of post-retirement benefits other than

pensions, ASC715, GASB45


BPAS Firm Profile

• IRA– EGTRRA Rollovers

• $5k cash-outs from DC AND DB plans– Significant savings in DB related to admin and PBGC

expenses• Orphan plan accounts (Dewey)

– Voluntary Rollovers• Platform for Advisors for BPAS participant clients


BPAS Firm Profile

• MyPlanLoan Administration– Non-payroll deduct loan

administration for terminated participants or active participants where payroll deduction is not available

– Reduce leakage amongst participants who avail themselves of a 72p transaction that is offered in a prudent manner


BPAS Firm Profile

• Employee Benefit Trust Services ($16 billion)– Collective Investment Funds

• Unitization of managed accounts for use in multiple plans

• Transfer Agent, 3(38) status• CIFs are available on all major

trading platforms


BPAS Firm Profile

• BPAS Trust Company of Puerto Rico– Directed trustee for PR 1081 plans

• Participant directed DC• Keogh (smaller P/S and MP plans• Mid-market DB plans• Small cash balance plans

– Market Leadership• PR CPA society (CEU, Master Trust)• PBGC, Mendez


BPAS Firm Profile

• BPAS Fiduciary Services– 3(38) services to participant-direct DC plans sold and serviced by

registered representatives and directed trustees, neither of whom provide a potentially desirable service for the plan sponsor

– 3(38) services to cash-balance plans sold by individuals/institutions that cannot provide discretionary investment management services

– Under this model, BPAS Partners provide sales, relationship management, participant education and plan consulting services and receive 12(b)(1) or bp fee income


BPAS Firm Update

Community Bank System, Inc.

BPAS Community Bank, NA

CBSI/CBNA ranked as 4th best bank amongst top 100 publics in U.S. by Forbes in 2014CBNA, is a regional bank with $7.4 B in assets and 190 facilities in Upstate, NY and NE, PA

BPAS is an autonomous business unit and a material segment of CBSI, operating as a national practice


BPAS (Inc.)

BPAs, LLC

Daily Val. Plans

IRAVEBA/HRA

MPL

HB&T Co.

Hand Securities(Broker Dealer)

CIF AdminDaily Val. Custody

BPAS Fiduciary Services

HCG, LLC

Actuarial Services

H&W ConsultingNon Daily Val

DC

BPAS Trust Co. of PR

Directed Trustee

for Puerto Rico Plans

The BPAS Organization


Strategies to Compete

• Defining Value in a crowded DC Provider Space• Measuring plan level success• Marketing the message• Managing a profitable practice under 408(b)(2)• Reducing Plan Leakage

– Retaining assets in the Plan• Increasing Plan Participation and Savings Rates


Business Opportunities Beyond 401k/403(b)

• Cash Balance Plans• VEBA/HRA• Holistic Financial Planning• Capturing IRA Rollovers


Regulatory Updates

• 408(b)(2) v2• Expanded definition of fiduciary• State initiatives, which potentially compete with private

sector offerings, intended to increase coverage• Municipal bankruptcies and retirement benefits• Act 40 Funds, CIFs and fiduciary liability


Contemporary Investment Management Issues• Stable Value Offerings• QDIA

– Target– Risk-based

• Participant Education• Retirement Income Products

– Guaranteed income products– Longevity Risk products– Installment payment arrangements


Advocacy

• BPAS Appeal to Get Involved• ASPPA

– American Society of Pension Professionals and Actuaries• NAPA

– National Association of Pension Advisors• http://savemy401k.com/• PAC


Conclusion and Beginning

• Thank you for attending• We look forward to your feedback

and opportunities for program improvement

• We look forward to the continued success and growth of our partnership


Questions?

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Contact

Barry [email protected]

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