PRIIPS KID on IB

[SumZero]

Criticism is about what else IB could have done more if they really cared about customers (besides a vague email in December and wait that all people go and read the legislation and check all the situation, ETF by ETF).

Wouldn't this be possible without a massive amount of work ?
- create a db of etfs that will be forbidden to european customers (this they had to do in advance to update their systems)
- check whose european customers traded those ETFs in the last couple of months
- send an email alerting them that from X this won't be traded any longer

I don't get how this can be complicated. Sounds like simple cross of databases.

 

[burggraben]

Sure it possible. Not even hard since they needed to have it in their database which products are not tradeable anyway to make them not tradeable in the first place.

I guess nobody thought of doing it. Maybe everybody expected the major ETFs to provide the KID. Plus you can't expect IB to do much hand-holding with their customers. They are an excellent, but a no-frills broker. And personally I would prefer them to stay that way to keep comissions low.

 

[cruisecontrol]

lol there is zero relationship between keeping commissions low and not sending out a couple emails about this to warn people. They send out tons of alerts and messages about other stuff all the time. This was a goof up plain and simple, there is no excuse.

 

[Jos]

Is there any UPDATE on this? I am (IB UK customer) suddenly locked out on US domiciled ETFs. I hold for USD 400K on worldwide ETFs including a lot of US ones.

My conclusion so far:

• According to the IB helpdesk you can not get an exemption.
• I wrote a bunch of US ETF providers a mail. I got a reply that they are not willing to produce a KID for their US domiciled ETFs.
• European UCITS ETFs are not really an option because: (1) volume is usual lower (2) costs are higher and (3) they are dividend wise more efficient (4) US providers provide ETFs on more 'exotic' indexes.

I am really disappointed that I was suddenly locked out by IB.

Tx Jos

 

[burggraben]

You mean locked out by EU regulation, IB had no choice but to implement it.

 

[Obelixtrader]

I find this about IBKR from 19.7.2017 As a result, «we are thinking of applying for a banking license with Finma,» says Chait
https://www.finews.com/news/english...rs-jonathan-chait-switzerland-banking-license
They are registered as a securities dealers by Switzerland FINMA. They should apply for a banking licence in Switzerland and then cancel UK branch.

 

[burggraben]

Not sure if that would change anything regarding the KID requirement for customers who are domiciled in the EU.

It might allow IB to provide additional bank-type services to customers.

 

[d08]

The funny thing was, the Hong Kong office was completely clueless about it when I first saw it happening during Asian hours. What did IB think, people just won't notice they lost trading permissions?

 

[Collagen]

Things is that IB doesn't care much about losing a bunch of costumers permissions. And those that are big enough providing good fee to IB are not harmed by the new regulations.

 

[d08]

Things is that IB doesn't care much about losing a bunch of costumers permissions. And those that are big enough providing good fee to IB are not harmed by the new regulations.

Again, this is not up to IB. It's up to SPDR, iShares etc - the issuers of the ETFs.