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Growing Optimism for Commission Sharing Agreements after tough year says annual MPI Europe survey

MPI Europe, the specialist financial services consultancy, publishes today the results of our annual market wide survey for brokerage commission sharing agreements.

The analysis of usage and trends in commission management indicates that the sector has recovered after a tough 2012 and there is growing optimism for 2014 with increased usage predicted over previous years by the vast majority of firms despite the continued challenges of regulation and process complexity.

Our research has once again attracted a greater response with over 80 firms contributing, underlining the interest both in this survey and the topic of Commission Sharing Agreements.

Key trends include:

  • Reported growth is stronger in use of commission sharing agreements (CSA) than expected a year ago as usage recovers after a challenging 2012.
  • Growth trend looks to continue with close to 92% firms looking to maintain their current use or increase usage in the next year.
  • Positive trends on risk reduction with perception of some key risks reducing although challenges for the market as a whole remain.
  • Regulation is still a key concern for the market although firms individually seem confident that they can be effective in addressing requirements.
  • Operational risk concerns around the increasing global use of CSAs highlighting strain around operational control and process.

MPI surveyed a range of financial sector firms to understand the key trends, challenges and opportunities in the use of commission sharing agreements. The survey was conducted during July and August 2013 and received responses from over 80 asset managers, brokers and research providers. This annual survey has run since 2010 and has shown strong and increasing interest year on year.