Products June 8, 2007

Principal Unveils Online ESOP Reporting Service

The Principal Financial Group has unveiled a new online distribution service for employee stock ownership plans (ESOP).
Reported by
A news release from Principal said its e-Distribution Services reduces the labor-intensive process of manually collecting and processing paper forms – and improves accuracy – when it is time for participants to request distributions from the ESOP.
Principal said its product is being offered to clients with an ESOP and KSOP (a combination ESOP and 401(k) plan). Because the service is electronic, there are no printing and mailing costs and no time spent preparing mailings, or collecting and processing forms. The electronic efficiency also removes the chances for manual error or lost forms, the news release said.
Some of the additional benefits of Principal e-Distribution Services include, according to the news release:
  • distribution eligibility determination identifies participants eligible for a distribution according to plan provisions.
  • distribution notices inform participants of their eligibility and provides instructions for making an online election.
  • call center support provides access to a toll-free call center where retirement specialists can answer questions about the distribution process.
  • online viewing allows plan sponsors to view cumulative elections via online reports to help with cash management and budgeting.
  • immediate access provides eligible participants with immediate and ongoing access during the distribution election window and the opportunity to change their elections at any time during the distribution election window.
  • checkwriting cuts distribution checks according to participant elections; and
  • tax reporting provides full reporting and withholding for federal and state taxes.
More information is at www.principal.com/esop.
The Markets June 7, 2007

ETFs Gain $20B in May

U.S.-listed ETF assets rose by approximately $20 Billion in May with International, Style, Size, Specialty and Broad Market ETFs experiencing considerable asset growth.
Reported by
State Street Global Advisors’ (SSgA) latest monthly statistical report indicated that International, Style, Size, Specialty and Broad Market ETFs enjoyed gains of $6 billion, $5 billion, $5 billion, $2 billion and $1 billion respectively.
As of May 31, 2007, 507 ETFs in the U.S. were managed by 16 ETF managers, with assets totaling approximately $480 billion. Overall, industry assets increased by about 4%.
Thirty-two new ETFs were launched during May. State Street launched five ETFs tracking domestic fixed income market segments. BGI, Van Eck, Claymore, and First Trust Advisors launched 5, 1, 1 and 20, respectively.
In terms of managers, Barclays Global Investors (BGI) had the largest AUM with $284 billion in 136 ETFs, followed by State Street with $104 billion in 58 ETFs.
International ETFs saw assets grow by over $6 billion in May. iShares MSCI (EFA) was the category leader, contributing over $1 billion in asset growth.
Also in May, according to the SSgA report:
  • style ETFs showed strong growth for the month, adding over $5 billion.
  • size ETFs continued their growth, collectively adding approximately $5 billion.
  • sector ETFs slid this month, losing approximately $401 million.
  • specialty ETFs gathered assets for the month, adding over $2 billion.
As a group, sector-based ETFs experienced a loss of $401 million in assets. Health Care added the greatest assets for the period, climbing by $436 million.
More information about the SSgA data is at http://www.ssgafunds.com/etf/index.jsp.

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