IN FOCUS. A practical guide for alternative investment managers on creating registered open-end mutual funds

Transcription

1 IN FOCUS Providing industry insight into market trends, best practices, and service solutions HOW TO LAUNCH AN ALTERNATIVE STRATEGY MUTUAL FUND A practical guide for alternative investment managers on creating registered open-end mutual funds

2 With $13 trillion in assets at the end of , investor demand in the U.S. mutual fund industry fluctuates with the diversification of types and strategies of mutual funds available. The industry has experienced the introduction and growth of mutual funds designed to follow alternative strategies. Alternative strategy mutual funds offer investors the traditional mutual fund benefits of transparency, liquidity, and lower fees, while allowing for diversification and daily valuation. As more alternative asset managers are turning to registered funds to diversify their portfolio of products, it is important to understand the complexities, regulatory requirements, and significant opportunities of mutual funds. In the United States, mutual funds must be registered with the Securities and Exchanges Commission and are subject to the set of regulations adopted from the Investment Company Act of From the requirement to offer daily liquidity to the rules regarding the organization of a board of trustees, alternative managers interested in entering the mutual fund market should fully understand the differences between alternative investments and mutual funds. ALTERNATIVE INVESTMENT STRATEGY AND REGISTERED FUND CONVERGENCE Several capital market trends since 2008 have propelled the convergence of alternative investment strategies with the registered open-end mutual fund industry, creating what many refer to as retail alternatives, liquid alts, or registered alternatives. Both buy-side and sell-side dynamics have combined to create a favorable environment in which to launch and distribute non-correlative registered investment funds, including investor demand for diversification extending beyond simple equity and fixed income long only allocations. Institutional, adviser and retail investor allocation demand now includes nontraditional liquid investments to minimize volatility and generate risk-adjusted returns. Investor demand trends also include the transparency, governance, and regulatory oversight of alternative investment strategy investments required of SEC registered products. Also, investors would generally prefer the more timely and tax-friendly mutual fund 1099 than the Schedule K-1 private placement tax advice. Additionally, hedge fund managers have identified the registered fund market as a significant growth opportunity for their investment practice, adding the retail fund market segment to an existing private offering business for high net worth, foundation, endowment, and institutional investors. Many intermediary firms show preference to the mutual fund structure due to the efficiency of trading a registered fund and the standardization of fund information. Mutual funds provide alternative investment managers with distribution opportunities to additional markets and channels through intermediary firms such as wire houses, platforms, registered investment advisers and consultants, and retirement assets through IRA and defined contribution investments. This whitepaper provides a guideline for some of the critical steps in the process for a hedge fund manager, private equity manager, or fund-of-funds manager to consider in preparing a business plan to launch an alternative investment registered open-end mutual fund Investment Company Fact Book, A Review of Trends and Activities in the U.S. Investment Company Industry, 53rd Edition, 2

3 GETTING STARTED IS A REGISTERED OPEN-END FUND RIGHT FOR YOUR HEDGE FUND BUSINESS? When considering a registered version of a private fund investment strategy, alternative investment managers should view the mutual fund product very differently and separate from hedge fund products and the private fund market. Managers will need to understand and become comfortable with several critical and distinct differences in both the management of the registered fund portfolio as well as the operational requirements and distribution process for open-end mutual funds. The public offering of a mutual fund will require funds to follow U.S. Securities and Exchange Commission (SEC) and Internal Revenue Code (IRC) regulations regarding portfolio management, financial reporting, compliance, and distribution of your mutual fund. Some key differences between the private offering and a mutual fund offering include: SEC Registration A pooling of investor assets in a mutual fund that is sold publicly is required to be registered with the SEC by way of a registration statement, which includes trust documents, a fund prospectus, a Statement of Additional Information (SAI), service agreements, etc. All SEC filings reside in the public domain, including all quarterly, periodic, and annual mutual fund filings, which is quite different from the hedge fund industry where all fund information is shared only after the manager performs an investor qualification process. Incentive Fees An investment manager is not allowed to charge an incentive fee on an open-end mutual fund other than through a fulcrum fee, which is rare in the mutual fund industry. Portfolio Investment Diversification/Restrictions The Investment Company Act of 1940 (40 Act) and the IRC require, among other things, that the fund portfolio be diversified among a minimum number of investment securities and issuers as outlined in the prospectus and SAI. Portfolio managers and investment advisers to public funds are required to maintain compliance with diversification requirements and adhere to the SEC, IRC, prospectus, and SAI investment restrictions. Sample diversification requirements that should be taken into consideration as alternative strategies are applied to mutual funds include: Security Concentration At least 75 percent (50 percent for a non-diversified fund) of a mutual fund s total assets must be represented by cash and cash items (including receivables), U.S. Government securities, securities of other investment companies, and other securities, no one of which may constitute more than 5 percent of the mutual fund portfolio. Industry Concentration The fund may not purchase any security which causes 25 percent or more of the value of the fund s total assets at the time of the purchase to be invested in the securities of one or more issuers conducting their principal business activities in the same industry (other than U.S. Government securities, government agency securities, or the securities of other investment companies.) Issuer Concentration At the end of each fiscal quarter, not more than 25 percent of an investment company s total assets may be invested in the securities of any one issuer, except for the securities of the U.S. Government. 3

4 Portfolio Investment Liquidity The SEC requires the mutual fund be valued daily at a net asset value (NAV), which is a combination of the market value of all portfolio holdings, accrued income, and expenses for all outstanding shares. The NAV calculation requires that all investment securities be marked-to-market daily. Consequently, the mutual fund must hold liquid securities for which market quotations are readily available on a daily basis. In addition, the SEC places restrictions on the percent of illiquid securities the fund may hold: Not more than 15 percent of a mutual fund s net assets may be invested in illiquid securities, including repurchase agreements and time deposits that do not provide for payment within seven days after notice, guaranteed investment contracts, and commercial paper issued in reliance upon the exemption in section 4(2) of the Securities Act of Mutual Fund Service Structure The graphic below of the service structure for a mutual fund includes the major roles and responsibilities for each service provider. It is imperative that services are integrated in order to maximize operational efficiency and minimize potential risks for the investment manager and mutual fund. This allows the investment adviser to focus on investment management and asset growth. 4

5 Fund Expenses The registered fund industry requirements for SEC registration, portfolio compliance, daily valuation, daily investor liquidity and servicing, and other infrastructure costs creates greater startup and annual fund operating expenses than the private fund industry. Annual fund operating costs are charged to the mutual fund investors through the daily accrual of each expense. In addition, mutual fund assets can be used to pay for distribution and marketing related costs to grow fund assets, but only through the adoption of a Rule 12b-1 Distribution Plan, which is generally charged at a rate of up to 25 basis points. Investors pay these annual operating expenses in exchange for daily liquidity, fund governance, transparency, and daily mutual fund servicing. Fund Startup Costs Depending upon a significant number of variables, you should expect open-end mutual fund startup costs to be between $50,000 for a Multiple Series Trust product, and several hundred thousand dollars for a proprietary fund. For mutual funds, startup costs are borne by the adviser, not the fund. Sample common startup costs include legal services for SEC registration document drafting, filing and resolving SEC comments, EDGAR filing fees, service implementation, and prospectus printing. Asset Scale and Break-Even Due to the higher operating cost structure of a mutual fund as compared to a private offering, the break-even level for a registered fund is higher than for a hedge fund. ( Break-even level is defined as the point at which the fund assets support its infrastructure costs and the investment manager begins to earn an investment management fee.) Depending on a host of variables, this break-even asset level can be as low as $25 million for a single manager long/short fund, or as high as $200 million for a more complex fund. Sample variables that drive mutual fund operating costs include investment security types (e.g., domestic vs. foreign), number of sub-advisers, number of share classes, average size of investor accounts, distribution fee, shareholder servicing options, trustee compensation, and state registration fees. Portfolio Transparency Mutual fund portfolio holdings are required to be disclosed and filed with the SEC at least quarterly, providing complete public portfolio transparency. In exchange for asset growth opportunity, it is important to understand that investment strategies and holdings are public record. Use of Prior Performance Provided you meet several requirements, you may use prior fund performance of an alternative investment product in your mutual fund registration statement. Sample requirements include consistency of investment team and investment strategy. Prior performance is generally not a substitute for the fund s performance and is limited to your registration statement and may not be advertised. 5

6 Investor Liquidity A portion of the mutual fund portfolio must be managed in cash in order to provide liquidity for anticipated daily investor share liquidations. This is generally managed at 5 to 10 percent of portfolio assets. An additional or alternative means of liquidity for temporary liquidation needs is to maintain a borrowing facility through the fund s custodian to support the disbursement of liquidation proceeds until portfolio security proceeds are available, or until subscriptions offset liquidations. Governance A registered fund established under a trust is governed by a Board of Trustees. The investment adviser is a service provider to the trust and is selected, reviewed, and approved by the Board of Trustees based on established criteria under the SEC Section 15(c) process (see management fees below). Trustees have a fiduciary responsibility of oversight of the management and operations of the mutual fund in good faith and in the best interests of the fund and its shareholders. Distribution Mutual fund distribution requires significant resources and a well-designed sales strategy. There are five mutual fund distribution channels: direct, advisory (broker or RIA), institutional, retirement, and supermarket/platform. If a mutual fund is sold through broker-dealer, supermarket, platform, or defined contribution intermediaries, compensation to third parties will impact fund expenses and/or adviser profitability by up to 40 basis points. As a hedge fund manager, you most often communicate directly with your investors, either in person or over the telephone. A significant difference with your mutual fund is that your investors are most often serviced by intermediaries, often through an omnibus account with the transfer agent. In this situation, you will not have direct access to the investor. Instead, you will service the intermediary firms as your customer and create a service model for communications and support. In addition to the requirements and operations of a mutual fund, it is prudent for a hedge fund manager to address several questions before launching an open-end mutual fund: Investment Strategy Will my alternative investment strategy fit within the requirements of a mutual fund? Or, can I sufficiently modify the portfolio construction to meet SEC, IRC requirements without detracting from portfolio performance? Public Offering Am I comfortable with the public nature of a registered fund and the public disclosure of my investment strategy? Mutual Fund Distribution Will we gather sufficient fund assets to support the costs of a mutual fund during the first year of operations? What is the investor demand for a registered offering of our hedge strategy? What is the primary target market investor base and distribution channel for the mutual fund? What sales and marketing resources are required pre-launch and post-launch to generate continual asset growth? Business Impact How will the registered alternative fund impact the success of my hedge fund/fund-of-funds/ private equity investment management business? What is the operations impact, client impact, financial impact to my business? Will the registered fund cannibalize my private product business? What is the potential investment management revenue and profitability for the mutual fund vs. the private investment business? A common successful investment management business model includes a combination of three product structures to serve distinct investor segments separately managed accounts, private investment funds, and registered mutual funds. 6

7 The significant differences between the mutual fund and alternative investment industries provide sufficient justification to approach the registered alternative strategy mutual fund as the launch of a new business. As hedge fund managers enter the mutual fund market, a business plan should be drafted that incorporates all aspects of a successful mutual fund business, including investment management, compliance, operations, distribution, and financial modeling. It s important to be especially careful and diligent to focus on the distribution plan for the fund securing initial fund assets and getting the fund to critical mass, and creating a plan to support asset growth for the first three years of operations. Key considerations include target market, target asset levels, sales and marketing resources specific to your primary distribution channel, and a complete profitability analysis. As a mutual fund manager, you need to be sensitive to fair and equal trade allocation across your hedge fund and your mutual fund, being careful not to allocate differently to any fund with a higher investment management fee. Also, you should be attentive to trading the same security in both your hedge fund and mutual fund - for example, holding an equity long in your mutual fund and shorting the same security in your hedge fund. Mutual Fund Classes Different mutual fund classes target different types of shareholders all invested in the same investment. Assets of all classes of a given fund are combined into one portfolio, with a different NAV created for each class of investor. Key Suggestion Your primary target market will determine what class or classes you will create broker-sold funds will require load classes such as A and C classes that compensate the broker for their services; institutional investors will want lower cost I shares, or institutional share classes. DECISION TO LAUNCH NOW WHAT? STEP BY STEP PROCESS TO LAUNCH YOUR REGISTERED FUND Once you have determined to launch a mutual fund, you will want to leverage the mutual fund expertise of an experienced administrator, legal counsel, and audit firm that specialize in the process of designing, launching, and servicing mutual funds, as well as supporting your investment management practice as it relates to managing the 1940 Act fund. Below is a sample sequence of fund implementation steps and milestones, including critical decisions regarding a successful mutual fund launch. The specific steps, timing, direction(s), costs and process will depend on the type of product and investment strategy employed. For example, a multi-strategy fund of five to 10 sub-advisers will require specific processes for SEC filing(s), subadviser on-boarding, compliance process, etc., as compared to a single manager long/short mutual fund strategy. 1. Determine Fund Structure There are two open-end mutual fund structures to consider, each with advantages for the investment manager. A comparision of two such structures - a Multiple Series Trust ( MST ) and a stand-alone proprietary (new) trust - is provided in the table below. The primary criteria for determining which structure is best for your business are cost, time to market, internal staffing resources, and whether or not you want to participate in the selection of fund board members and service providers. The MST is less costly to launch than a stand-alone proprietary trust and will have lower fund operating expenses until the fund gets to significant scale, e.g., $500 million - $1 billion (asset level dependent upon significant number of variables), primarily due to sharing the trust-level expenses across the many funds within the trust. Below is a summary of some of the differences between an MST and a proprietary trust. 7

8 DESCRIPTION: TRUST: MULTIPLE SERIES TRUST PROPRIETARY TRUST FUND BOARD OF TRUSTEES: FUND OFFICERS (PRESIDENT, TREASURER, ASSISTANT TREASURER, SECRETARY): A MST is an existing open-end SEC registered investment management company consisting of a series of mutual funds managed by unaffiliated investment advisers. Each fund is a separate series or separate portfolio within the trust, allowing multiple, unaffiliated advisers to gain economies of scale within one fund complex, sharing a common board, independent legal counsel, audit firm, and service providers. In place, with mutual fund industry experience; the mutual fund board generally includes an interested Trustee affiliated with the administrator. In place, provided by the MST, approved by the Trustees; generally employees of the administrator. A proprietary trust is typically established specifically for a single investment manager s product line and distribution strategy. The investment manager takes the lead in organizing the trust and is actively involved in the daily operations and administration of the trust and the trust board meetings. Generally selected and recommended by the investment manager; the mutual fund Board generally includes an interested Trustee affiliated with the investment manager. Generally selected and recommended by the investment manager, approved by the Trustees; generally employees of the adviser. INVESTMENT MANAGER ROLE: Adviser, approved by the Board of Trustees. Adviser, approved by the Board of Trustees. SERVICE PROVIDERS (FUND ADMINISTRATOR, FUND ACCOUNTANT, CUSTODIAN, DISTRIBUTOR, TRANSFER AGENT, LEGAL COUNSEL, AUDIT): In place, provided by the MST, approved by the Trustees. Generally selected and recommended by the investment manager, approved by the Trustees. FUND CHIEF COMPLIANCE OFFICER: In place, provided by the MST, approved by the Trustees. Generally selected and recommended by the investment manager, approved by the Trustees; commonly performed by the adviser CCO staff. ESTIMATED IMPLEMENTATION TIME: Generally days. Generally days. MUTUAL FUND BRANDING: Determined by the investment manager. Determined by the investment manager. ACTIVE DISTRIBUTION: Typically provided by the investment manager. Typically provided by the investment manager. 2. Product Design Your mutual fund legal counsel or administrator will work with you to develop the registration statement based upon your business plan for the mutual fund. Product design will include consideration of investment managers, portfolio construction, distribution, investor servicing characteristics, including the following sample considerations: Investment management process Investment securities employed/excluded Investment management fee analysis Share class structure to support distribution strategy Valuation process specific to investment securities Fund expense analysis Distribution and shareholder servicing fee analysis Comparable investment product, industry analysis Shareholder servicing options Prior performance assessment 3. Fund Launch Time Line / Implementation Plan The fund administrator and trust independent legal counsel will prepare a time line for the tasks involved in the registration and launch of the fund, based upon the unique product design. A typical timeline will include the following general project milestones to launch the mutual fund in a stand-alone proprietary structure, with references to the tasks eliminated in a series trust launch. Administrators will prepare a more detailed timeline specific to the unique product requirements and timing. The general time frame for a fund launch is approximately days for a stand-alone trust and days for a series trust registration. 8

9 SERIES TRUST SAMPLE MUTUAL FUND LAUNCH TIME LINE 1 Preparation Assemble material Adviser ADV, fund investment description details, portfolio manager(s) biography 2 NA Trust Service Providers Search and select fund administrator, accountant, custodian, transfer agent, distributor 3 NA CCO Determine Trust Chief Compliance Officer 4 NA Trust Legal Counsel Search and select fund independent legal counsel 5 NA Fund Audit Firm Search and select fund independent audit firm 6 Project Plan Prepare project plan, time line and roles/responsibilities 7 NA Officers Determine fund/trust officers-board chair, president, treasurer, secretary, assistant treasurer/secretary 8 Fund Budget Prepare fund budget and financial projections 9 NA Trust Policies Draft all Trust policies and procedures 10 NA Insurance Obtain Trust insurance policy quotes for approval fidelity bond, D&O 11 NA Trustees Identify, qualify interested and independent trustees; determine trustee compensation 12 NA Organizational Filing File Certificate of Trust with (State of Delaware) 13 NA Trust Registration Documents Draft all Trust documents, policies and procedures 14 Registration Statement Draft registration statement, review by all parties, revise and finalize 15 SEC Filing File initial prospectus and Statement of Additional Information and any necessary exhibits 16 SEC Comments Receive SEC comments (approximately 45 calendar days after filing) 17 File SEC Response Letter Respond to SEC comments 18 File for Fund CUSIP and Ticker 19 NA Seed Audit Independent audit firm audit of seed capital 20 NA Organizational Meeting Conduct organization meeting of trustees to review and approve all agreements, policies 21 Investment Adviser Presentation Presentation to the trustees for approval, 15(c) review process 22 File finalized prospectus and Statement of Additional Information and exhibits, including legal opinion and auditor s consent 23 Registration Effective SEC grants effectiveness of registration 24 Prospectus Printing Coordinate printing of prospectus 25 Fund Launch Commence fund operations, acceptance of subscriptions, investment of fund assets 26 Final Prospectus File 497(c) definitive prospectuses and SAI or File 497(j) letter stating that previously filed prospectus and SAI was final 4. Determine Investment Management Fees Through the product design phase, you will work with your administrator to determine the appropriate investment management fee for your product. The investment adviser service agreement with the trust, including the investment management fee, will be reviewed and approved by the Trustees following Section 15(c) of the 1940 Act. Trustees have a fiduciary responsibility to evaluate the investment advisory fee based on the nature and quality of services provided by the investment adviser and the fairness of the investment adviser s compensation in light of those services. Investment Adviser Fee Factors considered by Trustees in determining fairness of an investment adviser s compensation from a fund include: (1) the nature and quality of services rendered; (2) the investment adviser s profitability from advisory services to the fund; (3) indirect costs and benefits of providing the advisory services; (4) the allowance for economies of scale through the reduction of fees as fund assets grow; (5) the comparison of the advisory fees to those paid by comparable funds. 9

10 5. Prior Fund Performance There is the potential to utilize prior fund performance in the launch of a registered fund, provided that several criteria are satisfied, such as consistency in asset management team, investment strategy, and investment securities. The fund administrator and trust counsel will assist in this determination and provide additional criteria. 6. Tax-Free Conversion Many investment managers have converted limited partnership assets into a mutual fund in a tax-free exchange. Provided that the transaction meets Internal Revenue Code requirements to qualify as tax-free, this may be on initial source of assets for the new mutual fund. 7. Fund Expense Cap It is very common that the investment manager of a new mutual fund agrees to an expense waiver and reimbursement agreement in order to maintain the total fund expenses within a competitive range. If the fund is at very small asset levels during the first year(s), this agreement provides that the adviser will waive its management fee and/or reimburse the fund on a monthly basis to the extent that the fund expenses are above the expense cap. The administrator will forecast all expenses, including the waiver/reimbursement amount, to assist with the anticipated fund expenses. A critical element to a successful mutual fund is understanting fund expenses. Indicated below are typical annual operating expenses for a mutual fund commonly found in a fund s annual and semi-annual report, as well as the services performed for each expense. One of the administrator s roles is to plan, track, pay and report fund expenses, as well as manage these fund expenses within acceptable ranges for comparable products. Although the below expenses are the most common, additional fund expenses such as dividends and interest expense on securities sold short, borrowing expenses, and acquired fund fees and expenses will also apply to the funds engaged in certain practices with respect to portfolio management. COMMON MUTUAL FUND EXPENSE STRUCTURE FUND EXPENSE TYPE INVESTMENT ADVISER FEES TRUSTEE FEES PROFESSIONAL FEES FUND ADMINISTRATION AND ACCOUNTING FEES TRANSFER AGENT FEES CUSTODY FEES REGISTRATION FEES SHAREHOLDER REPORTS MISCELLANEOUS EXPENSES DISTRIBUTION FEES SHAREHOLDER SERVICING FEES EXPENSE DESCRIPTION Fees paid by the fund for investment advisory services, including payments to sub-advisers Fees paid to the independent trustees for their service to the Trust Generally audit and legal services to the Trust for daily/periodic legal support, audit, tax reporting Services to calculate the daily NAV, perform compliance testing and reporting, financial reporting, regulatory filing, board meeting facilitation, tax services, maintaining the fund s books and records, etc. Services to support all investor record keeping, investor reporting, tax reporting, investor e-commerce, call center services, etc. Services to support the trade settlement, safekeeping and corporate actions of fund securities SEC 24f-2 fee paid annually on net fund sales and state Blue Sky registration fees charged by each state s securities commission Costs associated with the printing and distribution of any daily, monthly, semi-annual and annual reports to shareholders Generally includes D&O and Fidelity bond insurance, ICI membership, trustee travel and board expenses, NASDAQ fees, security pricing services, CCO fees Fund expense associated with Rule 12b-1 distribution fees that can be used to pay distribution related expenses associated with growing fund assets Fund expense associated with payments through a Shareholder Servicing Plan generally used for payment of third party intermediary shareholder services 10

11 PARTING THOUGHTS A publicly offered investment product such as an open-end mutual fund may provide significant growth opportunity for an investment manager s hedge fund business. As a part of the analysis to undertake the sponsorship of a registered mutual fund, investment and operations teams will need to become familiar and comfortable with significant differences between the private fund and public fund industries, including compliance, public financial reporting, portfolio diversification, portfolio liquidity, daily investor liquidity, daily security/portfolio valuation, and mutual fund distribution. Although the open-end registered fund offering provides a vehicle to support significant asset growth and potentially reach additional investor markets, the mutual fund industry often requires proven fund performance over a one to three year period in order to gain attention and assets through certain distribution channels. Consequently, the launch of a mutual fund is a long-term business commitment requiring careful planning, market research, and significant preparation. ABOUT THE AUTHOR Through more than 40 years of continually enhancing our fund services, and by working with our clients to grow their business, we are fortunate to support more than 30 percent of all mutual fund complexes. ABOUT US Bob Kern is a Managing Director and Executive Vice President of U.S. Bancorp Fund Services, LLC. He began his career with U.S. Bancorp in 1982 and has served as a manager within the fund services subsidiary since From 1984 to 1994, Mr. Kern managed business development efforts as well as the mutual fund Transfer Agent operation including the Investor Services group, Account Services, Legal Compliance, Document Processing, and Systems Support divisions. During that time, Mr. Kern assisted in the management and implementation of both services and technologies related to Transfer Agent and shareholder services, Fund Accounting, Fund Administration, literature fulfillment, and fund Distribution services. Education and Credentials Mr. Kern received his undergraduate degree from Marquette University in business administration with specializations in finance and marketing. Mr. Kern serves as a board member of U.S. Bancorp Fund Services, LLC, Quasar Distributors, LLC, and interested Trustee and Chair of Managed Portfolio Series, an open-end mutual fund multiple series trust. For more than 40 years, U.S. Bancorp Fund Services, LLC has leveraged specialized experience across our organization to provide seamless service solutions for our clients regardless of the complexity and depth of their products. With client relationships lasting since our inception in 1969, we know the foundation for strong relationships is built on open communication, trust, and accountability. Our managers and professionals will deliver the amount of support, guidance, and insight into the market our clients need to be successful. 11

12 Visit for additional white papers and case studies or call for more information about our comprehensive suite of services. Headquartered in Milwaukee since 1969, U.S. Bancorp Fund Services, LLC currently provides services to more than 436 mutual fund and alternative investment clients with 2,761 portfolios and aggregate assets of $779 billion. U.S. Bancorp Fund Services clients include mutual funds, investment partnerships, hedge funds, separately managed accounts, fund-of-funds, and offshore funds. It is a subsidiary of U.S. Bancorp, the fifth largest bank in the United States with assets of $353 billion, NOTED IN THE SECOND QUARTER 2013 CORPORATE PROFILE U.S. Bancorp Fund Services, LLC. All rights reserved