Merit Capital Accounts

Merit Capital now also provides Merit Capital accounts.

Merit Capital, founded in 2000, with offices spread throughout Flanders, is one of the few remaining independent stockbroking firms in Belgium. This independence allows us to pursue an innovative investment policy and to recommend products of other asset managers. At Merit Capital the needs of the client always come first, with asset preservation as the basis and asset growth as the ambition.

Merit Capital is a stockbroking firm providing a personal service founded on transparency. Transparent, because we always give you a straight answer to all your questions. Personal, because your needs always come first. Our Account Managers are committed to developing long-term relationships and giving tailored advice. Regular assessment meetings are your guarantee that we continue to fulfil all your wishes, even if your needs suddenly change in a dynamic market.

You probably already know that Merit Capital is growing, a growth which we believe will be consolidated for the foreseeable future. In this connection, Merit Capital has received the approval of the National Bank of Belgium for the provision of the following additional services to its clients (in accordance with Article 46, 2° of the Belgian Act of 6 April 1995):

  • Safekeeping and administration of financial instruments for the account of clients, including custodianship and related services such as cash/collateral management.
  • Foreign exchange services where these are connected to the provision of investment services.

For more information, please refer to the NBB website: www.nbb.be – Financial Oversight – Prudential supervision – Areas of responsibility – Stockbroking firms – Lists – Licensed stockbroking firms in Belgium.

This licence extension means Merit Capital will have its own identity within the financial world. Whereas in the past clients had a securities account linked to a cash account with a depository bank, all of these services can now be provided by your trusted stockbroking firm Merit Capital.

The licence extension now gives Merit Capital the potential to make an even bigger difference for its clients. Clients who decide to make the switch together with Merit Capital will therefore notice a number of changes. These questions and answers have been compiled to help explain the extension of the licence, and to answer any questions you might have about this subject.

If your question is not listed, or the explanation in the answer is not sufficiently clear, then Merit Capital recommends that you contact your Account Manager or write to: Merit Capital NV/SA, Museumstraat 12D, 2000 Antwerp, Belgium

What will change for clients who make the switch?

For clients whose faith and trust in Merit Capital leads to a switch to a securities account with an associated cash account with Merit Capital, we will no longer be bound by the rules and processes that would otherwise be imposed on us by the depository banks. The extension of the licence will create greater flexibility, naturally within the confines of the law, and an even more efficient management of your assets.

In concrete terms, you will notice the following changes: 

  • Securities accounts linked to a cash account can be opened faster and more efficiently.
  • Cash transfers will be quicker and easier.
  • Monitoring of various processes will be carried out by Merit Capital, which will benefit both the interests of the client and the independence of Merit Capital; 
  • We will only accept book money, which is safer, and thus cash deposits will not be accepted under any circumstances.

Why should I make the switch?

In addition to the operational and administrative advantages, clients who switch will also see the financial benefits:

  • Clients will be able to enjoy an interest policy drawn up by Merit Capital, and we will spread the risk over various banks and aim to achieve the best rate on a best-effort basis. 
  • The extension of the licence means that we can now also offer Forwards and Futures contracts. 
  • Merit Capital can open a savings account for, and in the name of, the client with a third party, which will help to spread the risks for the client. Despite this spread, the communication with the client will still be bundled in a single report.
  • The status of cash positions and money transfers will be updated several times a day within Merit Capital, which means investment decisions can be taken more quickly.
  • The pre-trade risk management of Merit Capital means the client will be better informed before an order is placed on the market.
  • Merit Capital checks the accuracy of the prices of securities every morning, and by using various databases we aim to provide the most accurate valuations on a daily, best-effort basis. The risk profile of your portfolio will be managed entirely by Merit Capital. Before a particular order is carried out, your portfolio will be assessed for compatibility with your profile.
  • Complete openness about earnings and costs will create even more transparency for the client. 

Will my assets still be protected after the switch?

Absolutely: the deposits of account holders with financial institutions in Europe, and thus also in Belgium, enjoy a high level of protection via the deposit guarantee scheme. The deposit guarantee scheme has a dual purpose: to protect the deposits of account holders and to maintain financial stability.

Who is protected by the deposit guarantee scheme?

The deposit guarantee scheme offers protection to all private individuals and companies that hold one or more securities accounts and associated cash account with a financial institution. The protection applies for each natural person or legal person and for each financial institution.

What is protected?

  1. The guarantee applies for all deposits in a currency of the European Economic Area, as well as the deposits in securities accounts and debt instruments issued by credit institutions (e.g. medium-term notes), and this up to an amount of EUR 100,000.
  2. This scheme has also been expanded to cover certain life insurance policies, likewise up to an amount of EUR 100,000.
  3. The guarantee for financial instruments and securities held in custody is limited to EUR 20,000.

For information about the Belgian deposit guarantee scheme, please refer to the website of the Belgian supervisory authority: www.nbb.be

Is this the only protection enjoyed by investors?

In addition to the protection offered by the deposit guarantee scheme, there is also a legal obligation to ensure the segregation of client funds. This means the liquidities of clients must be kept in separate bank accounts to segregate them from the operating accounts of Merit Capital. The client account is thus protected against a potential deficit of an asset manager acting as a depository bank.

In connection with this additional protection, it should be pointed out that segregated funds are excluded from any liquidation, which also provides an additional level of protection for the client. Merit Capital keeps the funds of its clients with various banks in order to optimise risk spreading.

Does the regulatory authority monitor the way in which the additional services are carried out under the extended licence?

Since 1 April 2011, the supervision of Belgian financial institutions has been carried out in accordance with the Twin Peaks model. Before that supervision was carried out by the CBFA (Commission for the Banking, Finance, and Insurance Sector), but it was then divided up into two separate areas:

  1. The National Bank of Belgium (NBB) was given responsibility for maintaining the macro-economic and micro-economic stability of the financial system. In addition to the macro-prudential supervision it already carried out, the NBB is now also responsible for supervising the individual factors within the financial market. Supervision of the solidity of financial institutions also falls under this expanded responsibility, because the enforcement of compliance with the requirements for solvency position, liquidity and profitability of these financial institutions has now been placed in the hands of the NBB.
  2. The CBFA has been renamed the ‘Financial Services and Markets Authority’ (FSMA), and is still responsible for supervising the proper operation, transparency and integrity of the financial markets, and the unlawful offering of financial products and services. Its area of responsibility has been extended to include supervision of the rules of conduct applicable to financial institutions, in view of ensuring that all clients are treated honestly, fairly and professionally.

Who can I go to in the event of a dispute?

If there is a dispute and if our institution is not able to resolve it to your satisfaction, you can take your case to the independent ombudsman:

Ombudsman in financial conflicts, Rue Belliard 15-17/8B, 1040 Brussels, +32 (0)2 545 77 70, ombudsman@ombfin.be, www.ombfin.be