CIBC Mellon has agreed a referral arrangement with Donaldson & Co., to launch a commission recapture program in Canada that will recapture a portion of trading commissions directly back to investment funds through a global broker network.
CIBC Mellon clients will be introduced to Donaldson & Co., which will establish and maintain the broker network, negotiate all commission recapture rates, collect and reconcile all recaptured commissions, prepare consolidated activity reports and provide a single point of contact for service.
“Canadian equity returns over the last five years have materially increased the amount of money invested by Canadian investment managers on behalf of their clients,” says John Withers, managing director at Donaldson & Co. “Along with this higher level of investment activity comes higher commission charges because of the increased volume of shares purchased. Our commission recapture program can help institutional investors lower their trading costs – with the opportunity to achieve higher rates of return.”
“This program can help institutional investors potentially reclaim up to 70 per cent of the trading costs associated with commission recapture directed trades,” adds James Slater, CIBC Mellon’s senior vice president, capital markets. ” In addition to enhancing the transparency of trading costs and cost containment structures, the commission recapture product can assist institutional investors in improving fund governance.”
Donaldson & Co. is a division of Knight Equity Markets, L.P.The firm was founded in 1984.