BEA dangles one-off bonuses to lure MPF transfers ahead of the ECA

Bank of East Asia Trustees launched rewards for new and existing MPF customers who moved their accrued balances into its Master Trust Scheme — as anxiety grew among employees and distributors about MPF performance in late 2011.

What was on offer?

Clients applying during the promotion (until 31 December 2011) who transferred HK$10,000 or more from another provider by end-January 2012 could receive a one-off bonus from HK$100 up to 0.68% of the amount transferred. The top 10 transfers in each of five bands earned an extra 0.32%; the 10 largest overall transfers could add HK$1,000–10,000 more.

“Award-winning services” — and a clawback

“Our award winning MPF services are tailored to suit customers’ varied needs. We encourage customers to take advantage of this opportunity to consolidate the management of their MPF assets while they enjoy these attractive offers,” said Patrick Li, director and chief executive of BEA Trustees. But bonuses would be clawed back unless transferred assets stayed put until end-February 2013 — a 14-month lock-in for a one-off sweetener.

The ECA context: everyone wants your balance

BEA’s move was part of a wider pre-ECA land grab: with employees soon able to move benefits annually, trustees competed with fee cuts (Fidelity, BCT, Principal) and bonus rebates (AXA, AIA, Manulife, BOC-Prudential) alike. The industry had realised the same thing: in a portable market, the existing balance is the prize, and acquisition spending is rational.

What members can do

A bonus is a reason to look, not a reason to move. Compare expense ratios, check fund suitability, and do the maths: a 0.68% one-off bonus is wiped out by a 0.2% annual fee gap within four years. The MPF education hub shows how to compare schemes properly.