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Chart 73: Will the DOL’s fiduciary rule cause meaningful changes to the brokerage industry? 90% 83% 80% 10% 60% 50% 40% 30% 20% 1% 1% 10% 9 0 3% 0% 0% Yes, significant Yes, a shift to Yes, assetsin Allofthe above —_No significant pressure on advisory and fee motion with some impact commission based accounts __to robo advisor revenues and RIA platforms Source: BofA Merrill Lynch Global Research e« We also asked about changes to the asset management industry, positing “Will the DOL’s fiduciary rule cause meaningful changes to the asset management industry?” Investors again expect multiple changes (91%), including an accelerated shift from active to passive, further pricing pressure, and higher cost of distribution and margin pressure. No respondents expect there to be no significant impact to the asset management industry. Chart 74: Will the DOL’s fiduciary rule cause meaningful changes to the asset management industry? 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Yes, an Yes, further Yes, higher cost of Allofthe above —_No significant accelerated shift pricing pressure distribution and impact from active to margin pressure passive Source: BofA Merrill Lynch Global Research « The panel noted that President Elect Trump did not address the Fiduciary Rule during his campaign, so his view on the rule is unknown, but Republicans have largely been against it. There is some precedence on what we could expect President Elect Trump to do with the fiduciary rule. President Bush had implemented an investment advice regulation that President Obama delayed several times until it was finally withdrawn. The view from the panel was that the most likely action over the next several months is that President Elect Trump delays the rule, though to repeal or change it would take work and new regulatory 50 2016 Future of Financials Conference | 17 November 2016 Bankof America 2 Merrill Lynch HOUSE_OVERSIGHT_014364