Delivering on our promises
It’s certainly been quite a year, one full of change, new opportunities and celebration. In the past 12 months, MD Financial Management (MD) has celebrated both its 50th birthday and the one-year anniversary of the acquisition by Scotiabank®.
When the sale of MD was announced, Alex Besharat, Senior Vice President and Head of Canadian Wealth Management at Scotiabank, and I asked you to give us some time to prove that MD wasn’t going to change. We know that actions speak louder than words, and we wanted the opportunity to demonstrate that we were going to remain the same MD our clients have known and trusted for 50 years.
One year on and it’s clear that we’re not just the same MD — with Scotiabank in our corner, we’re better.
Promise: No increases in fees
Last year, we promised you the same fees or lower. And we’ve delivered. Not only have our fees not gone up, we’re actually charging most of our clients less. By leveraging our relationship with Scotiabank and through fee negotiations, we reduced annual investment fees by about $6 million, while increasing global asset exposure and the potential for improved portfolio outcomes, benefiting virtually all clients of MD’s funds and portfolios. Our Series A management expense ratios (MERs) are, on average, 29% lower in cost than the industry average; Series F MERs are, on average, 49% lower in cost than the industry average; and Series D MERs are, on average, 11% lower in cost than the industry average.1
Promise: The same objective, physician-centred advice you’ve always trusted
There’s been no change to how we compensate our Advisors*. They remain salaried and don’t get paid commission for selling one investment product over another. They’re also not rewarded for selling specific banking products. Meeting your unique financial needs as an individual remains their sole purpose. We know that when you succeed, we succeed.
By leveraging Scotiabank’s tools and technologies, we’ve also been able to enhance our ability to analyze and manage risk, strengthen our already stringent anti-money laundering process and upgrade our employees’ training and knowledge.
Promise: A strong physician voice at MD
We know that physicians provide an invaluable perspective that strengthens who we are and what we do. That’s why we created the MD Physician Council. The nine physicians who form the inaugural Council are a diverse, engaged group of physicians who will help us better understand the pain points you may be experiencing across each life stage and the solutions you want us to offer. Stay tuned for more information about the Council’s discussions, including a French-only online discussion board to hear directly from francophone physicians across Canada.
We also enjoy exclusive partnerships with 16 different medical groups in Canada representing more than 65,000 physicians (not including the 75,000 CMA members). These partnerships keep us true to you, give us a deeper understanding of what really matters to you — and give you a strong voice at MD.
Promise: Broader and more innovative choices
Banking is an integral component of a physician’s holistic financial plan. We took our 50 years of experience and collaborated with Scotiabank to create the Scotiabank Healthcare+ Physician Banking Program, which includes Private Banking. The program, which is available exclusively to physicians, delivers various banking benefits, including lines of credit with preferred interest rates, medical student and resident lines of credit, and mortgage solutions that offer convenience, flexibility and even rewards. What’s more, a banking offer that meets the needs of physicians’ small incorporated practices is coming soon.
In the past year, we’ve launched unique solutions like the MD Platinum™ Global Real Estate Pool and MD Precision Index Portfolios™. We’ve also updated our portfolio construction methodology, known as MD Precision Portfolio™ Strategy, to improve the risk-adjusted returns for a number of MD funds and MDPIM pools. These changes are solid evidence that we’re delivering on our commitment to offer even more ways to help you achieve your financial goals and enjoy all of life’s possibilities.
Promise: Continuity and stability in MD’s leadership
As you may already know, I recently announced that I’ll retire as MD’s CEO in early 2020 so that I can spend more time with my family — especially my grandchildren. Daniel Labonté, who’ll take over as MD’s President and CEO on November 1, will ensure we retain our client focus and stay true to our commitment to deliver objective advice and even more physician-focused benefits. I’ve worked closely with Daniel over the years, and I’m confident his experience provides a strong foundation for him to lead MD into the future.
Promise: To advance physician wellness in Canada
When Scotiabank acquired MD, it promised to invest, in collaboration with the Canadian Medical Association and MD, $115 million over 10 years to support the medical profession. To date, a total of nearly $6 million has been committed: $1.6 million to Well Doc Alberta to support pan-provincial physician wellness initiatives, $3.58 million to support professional development for family doctors across the country and awards and scholarships for medical students and family medicine residents, and $625,000 to help an initial grouping of specialty societies to target the pressing issue of professional burnout among Canadian physicians. This is just the beginning. Stay tuned for further announcements in the coming weeks and months.
Our promise now: Our commitment to you will not change
The job ahead of us remains clear: to continue to prove that our commitment to you will not change. Alex, Daniel and I all firmly believe the relationship between MD and Canada’s physicians is sacred. It’s based on 50 years of experience and expertise. Protecting that relationship — and demonstrating that we’ll carry on earning your trust — continues to be our top priority.
Over the next 50 years and more, MD and Scotiabank will keep honing our skills and building on our combined experience so that, together, we can continue to deliver the excellence and innovation you deserve — as a physician and an individual — at every stage of your life.
Thank you for your continued trust in MD — there’s nothing more important to us than our relationship with Canada’s physicians.
1 MD compared the management expense ratio (MER) for MD mutual funds and MD Precision Portfolios™ (by series) with the average mutual fund MERs for comparable funds, using data from Strategic Insight as of December 31, 2018.
* MD Advisor refers to an MD Management Limited Financial Consultant or Investment Advisor (in Quebec), or an MD Private Investment Counsel Portfolio Manager.