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Tuesday, October 09, 2012|
Columbia Overhauls Its R Shares
Columbia Management is reorganizing the class of shares it offers to retirement plans, which includes making changes to the fee structure and making new shares available to advisors.
For several of its R Shares classes, Columbia is removing the distribution and administration fees, while increasing the fees paid to Columbia Investment Management Services, the transfer agent. In addition, it is renaming the current R3 shares as R4 and the current R4 shares will be renamed Class K shares.
The changes were disclosed in a recent SEC filing, and the story was first broken on our sister publication 401kWire.
Columbia is also changing the share classes available through some of the major clearinghouses, making some types of R Shares available to advisors. Columbia head of distribution, marketing, and products Chris Thompson told the MFWire that this move reflected both increased demand and changes to the business.
"There's a high level of demand, and in keeping with changes in the industry, we've decided to make new shares available through the major clearinghouses," he said.
Thompson told the MFWire that the decision to change its retirement offerings "was in keeping with a demand change that we're seeing from plan sponsors, who want to have greater choice and greater fee transparency."
"There's increasing demand for share classes that have a wider array of fees associated with them," said Thompson. "We're trying to offer a broader array and offer some classes that have fees stripped away. What we're seeing is a demand for share classes that have lower distribution fees associated with them."
The filing, which applies to the 101 funds in the three Columbia fund trusts, discloses the following changes, among others, to the retirement share classes:
Some of these changes take place Novermber 1, and some November 8; see the filing itself for the details.
These changes will affect the pricing of different Columbia funds in different ways, lowering costs for some classes and funds but raising it for others.
The Columbia Balanced Fund, for instance, currently charges 1.36 percent for its Class R shares. This will be reduced to 1.01 percent in November; but the cost of the current R4 class, soon to be K Shares, will increase from 1.05 to 1.10.
Printed from: MFWire.com/story.asp?s=41571
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