TORONTO and LONDON, Sept. 26, 2011 /CNW/ - RBC Dexia Investor Services
said today that 26 per cent of financial institutions worldwide have
little or no awareness of the Foreign Account Tax Compliance Act
(FATCA)—despite the fact that the Act was passed in 2010, according to
a survey conducted by the company.
FATCA is the cornerstone of US tax legislation relating to foreign
accounts held by US citizens. The intent of FATCA is to capture all
potential tax revenue that is payable on the worldwide income of US
Jean-Michel Loehr, Chief, Industry and Government Relations, RBC Dexia
Investor Services noted: "The message from this report is with all the
FATCA rules and regulations yet to be finalized - including any granted
exemptions - financial institutions can only take a measured approach
to preparation. The good news is that awareness is gaining traction;
the bad news is that the market needs much more clarification before
any program can truly be finalized."
The survey noted that European financial institutions appear to be
paying much closer attention with 86% of respondents confirming strong
levels of FATCA awareness. Larger organizations also see this as an
area of focus as 81 per cent of respondents with over USD 1 billion in
assets rated some or significant awareness.
Despite a lack of clarity about the full scope and impact of FATCA,
survey participants who are aware of FATCA are getting ready for its
eventual implementation. A majority, 54 per cent of respondents,
classed themselves as moderately to very prepared, while 36 per cent
considered themselves moderately prepared. Meanwhile, 21 per cent of
overall respondents admitted they were not prepared at all.
Early projections from survey respondents reveal that 85 per cent put
the cost of implementing FATCA at USD 1 million or less, with the
majority (54 per cent) expecting a bargain expenditure of less than USD
100 thousand. Only 5 per cent of respondents are anticipating expenses
over USD 5 million. There were no significant response variations based
on region or size of organization.
RBC Dexia's FATCA program was established in 2010 and is led by a cross
functional program steering committee. RBC Dexia will continue to track
FATCA readiness globally, assess the guidelines as they become
available from the United States IRS and Treasury, and develop a series
of resources to help clients manage for its implementation.
For a full copy of the report, please go to www.rbcdexia.com
In June 2011, RBC Dexia Investor Services conducted an online poll of
financial institutions worldwide to gauge their current level of
preparedness for the impending introduction of the FATCA, as well as
the expected impacts.
The survey results represent the aggregate responses of 217 financial
institutions, market participants and intermediaries with assets
ranging from less than USD 100 million to over USD 1 billion.
About RBC Dexia Investor Services
RBC Dexia Investor Services offers a complete range of investor services
to institutions worldwide. Our unique offshore and onshore solutions,
combined with the expertise of our 5,500 professionals in 15 markets,
help clients grow their business and sustain enhanced performance
through efficiency improvements and robust risk management practices.
Equally owned by RBC and Dexia, the company ranks among the world's top
10 global custodians with USD 3.0 trillion in client assets under
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RBC Dexia Investor Services Limited is a holding company that provides
strategic direction and management oversight to its affiliates,
including RBC Dexia Investor Services Trust, a trust company,
supervised in Canada by the Office of the Superintendent of Financial
Institutions, and authorized to carry on business in the U.K. by the
Financial Services Authority. All are licensed users of the RBC
trademark (a registered trademark of Royal Bank of Canada) and Dexia
trademark (a registered mark of Dexia Crédit Local) and conduct their
global custody and investment administration business under the RBC
Dexia Investor Services brand name.
SOURCE RBC Dexia Investor Services
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