Fidelity® Tax-Exempt Defined Contribution Business Doubles Since 2008; Participant Growth Up 30 Percent

Rochester Institute of Technology, Oregon Health & Science University, and MedStar Health Among the Tax-Exempt Institutions Consolidating Assets with Fidelity

BOSTON – Fidelity Investments®, a leading provider of workplace retirement plans in tax-exempt markets, today announced that Assets Under Administration (AUA) have doubled since the start of the financial crisis five years ago. Through the first half of 2013, Fidelity’s AUA has reached $204 billion, a 102 percent increase from 2008 . Additionally, since 2008i, Fidelity has seen a 30 percent increase in the number of plan participants it serves in not-for-profit institutions.

“Growth has been largely fueled by the higher education trend toward retirement plan consolidation and significant changes impacting the health care market. Employers are looking for a provider nimble enough to keep up with an increasingly complex regulatory and economic environment, and one that is very committed to their market,” said Rick Mitchell, executive vice president, Tax-Exempt Retirement Services, Fidelity Investments. “Fidelity’s leadership and expertise in these markets and the recordkeeping and retirement planning capabilities we deliver enable plan sponsors to navigate the industry-specific challenges and regulations they face, and provide more effective retirement plans and solutions to their employees.”

Fidelity serves more than 4 million plan participants in more than 2,000 workplace savings plans across the not-for-profit market, including higher education, health care, research, foundations, faith-based, K-12, and other not-for-profit organizations. From 2008 through the first half of 2013, Fidelity has added nearly 1 million participantsii.

Higher Ed Institutions Continue to Consolidate Retirement Plans
Two trends continue to influence retirement plan design in the higher education market: an increasing desire to streamline retirement plan administration, and the need to achieve compliance with recently-implemented IRS regulations requiring 403(b) plan providers to enhance their fiduciary oversight. Implementing these changes often involves a challenging process which impacts how the plan operates as well as employee communication, education, and retirement planning.

As a result, institutions are looking to work with a provider with deep expertise who can help guide them through this increasingly complex process, including consolidating the number of plan providers to reduce administrative complexity and cost, as well as to simplify savings decisions and improve outcomes for their employees.

For example, Rochester Institute of Technology (RIT), a private university in upstate New York, set a strategy to streamline their retirement plan to improve efficiencies, oversight, and employee engagement. RIT selected Fidelity as their lead recordkeeping service provider and looked to the firm to manage the transition. Fidelity provides administrative services for $330 million in retirement assets for the institution.

“When we consolidated our workplace retirement plan, it was important for us to streamline our plan administration, enhance the efficiency of our compliance oversight, and provide a best-in-class investment lineup to our employees,” said Jim Watters, Senior Vice President of Finance and Administration, Rochester Institute of Technology. “Fidelity’s lead recordkeeping capabilities and flexibility to meet the investment and education needs of our employees were the best fit for RIT. We have simplified our administrative work while improving our employee’s retirement and saving experience.”

Oregon Health & Science University, a world-class health and research university with more than 10,000 active participants, recently consolidated its retirement providers – naming Fidelity its lead recordkeeping service provider. In making the choice, the university cited the firm’s recordkeeping expertise and ability to effectively transition and service their retirement plans. Fidelity now provides administrative services for $486 million in retirement assets for the institution.

“When we decided to consolidate, we had four key objectives: simplify the plan options for our employees to reduce confusion and increase their participation, reduce investments fees, add new investment options to offer more flexibility to our employees, and streamline our plan administration,” said Tracie Marsh, Retirement and Compensation Analyst, Oregon Health & Science University. “Fidelity’s communication approach during the transition and commitment to education and one-on-one guidance has increased our employees’ engagement with the plan, and we are very pleased with Fidelity’s recordkeeping support and the efficiencies we’ve achieved.”

Economic Changes Reshaping the Benefits Landscape for Health Care Institutions
The Patient Protection and Affordable Care Act has accelerated changes in the health care industry, leading many health care employers to reexamine their total benefits costs and develop strategies to comply with the mandates and deadlines. In this increasingly dynamic market, retirement plan sponsors are seeking a firm with the expertise, capabilities, and scale to help them implement strategies that deliver a competitive, cost-effective retirement benefits offering.

“At Fidelity, we consistently hear from health care institutions that they need a retirement provider that offers premium recordkeeping and planning services, but just as importantly, they need a firm who understands the complexities of this market,” said Mitchell. “We do not react to the ever-changing health care environment; we lead with solutions that help ensure our clients’ retirement programs remain competitive despite the many changes ahead.”

MedStar Health, Inc., a not-for-profit regional health care system across the Maryland and Washington, D.C. regions, relies on Fidelity to enhance the employee engagement experience and enhance retirement plan participation rates. Fidelity provides administrative services for more than $1 billion in assets for nearly 25,000 participants.

"MedStar Health is dedicated to the communities we serve and our work with Fidelity is an indication of our commitment to our associates' financial well-being," said David Noe, Vice President of Corporate Human Resources at MedStar Health, Inc. "Fidelity brings deep health care industry perspective and plan administration expertise to support MedStar's strategic growth, and their guidance capabilities give us great confidence that MedStar associates will receive an exceptional retirement planning experience."

Fidelity has also seen strong growth across other not-for-profit markets. Recently, Fidelity was selected as the retirement provider for Sacramento Municipal Utility District (SMUD), a publically-owned electric utility in California, and University of Wisconsin Medical Foundation, a large academic, multi-specialty physicians group.

Fidelity’s Services for the Tax-Exempt Market
Fidelity is the leading retirement plan provider for the not-for-profit health care market and the second largest provider in higher educationiii. Fidelity’s comprehensive of 403(b) retirement services include plan design resources, recordkeeping services, consulting and participant communication, education and guidance. With retirement planning professionals, and a wide-array of tools and resources available to educate plan sponsors, Fidelity helps the tax-exempt market maximize their retirement benefits plans and increase employee retirement readiness.

Fidelity offers insightful industry white papers to help plan sponsors increase retirement readiness through plan design, and regularly commissions propriety research to help better understand the attitudes and behaviors of the retirement plans and participants in the not-for-profit space. Recently, Fidelity published Defining Excellence: Plan Design and Retirement Readiness in the Not-for-Profit Healthcare Industry to help healthcare organizations assist employees in meeting retirement goals.

Additionally, Fidelity offers a wide variety of resources, including:

• Access to investment professionals on-site at the workplace, by phone, online or at 182 Investor Centers nationwide

• Comprehensive guidance on retirement and personal savings options

• Planning tools and savings calculators to help invest, manage assets and achieve retirement readiness

• Workshops, educational articles, webcasts and online resources about retirement planning

About Fidelity Investments
Fidelity Investments is one of the world’s largest providers of financial services, with assets under administration of $4.2 trillion, including managed assets of $1.8 trillion, as of August 31, 2013. Founded in 1946, the firm is a leading provider of investment management, retirement planning, portfolio guidance, brokerage, benefits outsourcing and many other financial products and services to more than 20 million individuals and institutions, as well as through 5,000 financial intermediary firms. For more information about Fidelity Investments, visit www.fidelity.com.

 i Fidelity business data
ii LIMRA (Life Insurance and Market Research Association), Not-for-Profit Retirement Market, 4th Quarter 2008 and 2nd Quarter 2013.
iii LIMRA (Life Insurance and Market Research Association), Not-for-Profit Retirement Market, 2nd Quarter 2013.

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