RBC Dexia: Australian Financial Reforms for Transparency, Efficiency and
Global Competitiveness Face Tough Political Climate

SYDNEY, Oct. 28 /CNW/ - Australia's proposed financial reforms are likely to increase transparency,
investor confidence and efficiency, as well as competitiveness, say asset managers, private wealth
managers, insurers and other Australian market participants surveyed by RBC Dexia in a report released
today. But the ultimate success of the reforms remains in question, given their size and complexity and the
challenges of the current political situation.

RBC Dexia surveyed a range of financial institutions active in Australia on the expected impact of the
Super System Review (Cooper Review) on superannuation; the Future of Financial Advice Reforms on the
retail investment and financial adviser markets; the Future Tax System Review (Henry Review) on taxation
and the Australian Financial Centre Forum's report on the region (Johnson Report).

David Travers, Managing Director of Australia for RBC Dexia Investor Services commented "The
respondents to the survey have made their voice heard on the potential of these reforms to improve
Australia's financial system. The question raised is when, and perhaps whether, they will come to pass. It
would appear to be a missed opportunity for Australia if the present political landscape thwarted the
drive for change."

Benefits of reform

The most important single benefit was seen as increased transparency (28%), followed by increased
investor confidence (21%) and increased efficiency (19%). One in ten (11%) nominated better value
services being provided to end consumers. All the reform packages, most notably the Cooper Review
and the Future of Financial Advice Reforms, focus heavily on these areas.

The various planned reforms and reviews are partly designed to boost competition, both within the
Australian market and internationally, through specific initiatives such as the Johnson Report. A clear
majority of 65% thought that the reforms would make the Australian finance industry more
competitive locally, while 56% thought it would become more competitive internationally.

Fund management companies are likely to be the greatest beneficiaries of the Johnson Report. Just
over half of our poll respondents (52%) felt that fund managers would be the key beneficiaries of
these recommendations, with the proposed IMR and Asia-Pacific Funds Passport clearly aimed at this
audience. However, the balance nominated other financial sectors (e.g., banking, insurance,
custody) or was uncertain, suggesting that the Johnson Report will have broad impact across the
financial industry.

Impact from Asia

Some respondents saw the overall impact of the proposed reforms on inbound and outbound
investment as broadly positive (35% for inbound, 34% for outbound), while around 40% saw no impact
and the remainder were unsure. Respondents who did see an external impact on either inbound or
outbound investment noted that this impact would likely come from Asia.

"Australia has been working to build its business ties within the wider Asia-Pacific region for some years
and, as our poll indicates, Asia still looks the most likely source of both inbound and outbound investment
business," added Travers.

Barriers to reform

Respondents were asked what they thought would be the greatest barrier to the implementation of
these reforms. The greatest barrier seen today is the complexity of regulation (31%). One in four (24%)
were concerned about the sheer volume of the reforms involved, while one in seven (14%) worried
that there might be industry opposition.

The survey shows that an overwhelming majority of Australian asset managers (94%) believe the
Cooper Review will have the most significant impact on the Australian market, probably because its
primary focus is on superannuation provision, which is mandatory in Australia and therefore of huge
importance. The Future of Financial Advice Reforms and the Henry Review are also seen as significant
by a clear majority, rated as significant by 81% and 75%, respectively.

Methodology

RBC Dexia surveyed a range of financial institutions active in Australia to understand the key trends
and challenges facing the market. The survey was conducted during a three- week period from
August 4 to 25, 2010 and the results reflect feedback from 63 respondents operating in Australia.

The greatest proportion of respondents (46%) were asset managers. Others represented service
providers (19%), Superfund managers (7%), private wealth managers (5%), insurance companies (3%)
and consultants (3%), while 11% represented organisations which offered a range of financial services
and 6% other organisations with an interest in the financial services industry. A significant 63% of our
respondents were handling assets under management worth AUD$1 billion or greater.

About RBC Dexia Investor Services

RBC Dexia Investor Services offers a complete range of investor services to institutions worldwide. Our
unique offshore and onshore solutions, combined with the expertise of our 5,400 professionals in 15
markets, help clients grow their business and sustain enhanced performance through efficiency
improvements and robust risk management practices.

Equally owned by RBC and Dexia, the company ranks among the world's top 10 global custodians with
USD 2.4 trillion in client assets under administration.
rbcdexia.com

RBC Dexia Investor Services Limited is a holding company that provides strategic direction and management oversight to its affiliates, including RBC Dexia Investor Services Bank S.A., a credit institution licensed in Luxembourg by the Commission de Surveillance du Secteur Financier and the Ministry of Finance. All are licensed users of the RBC trademark (a registered trademark of Royal Bank of Canada) and Dexia trademark (a registered mark of Dexia Crédit Local) and conduct their global custody and investment administration business under the RBC Dexia Investor Services brand name

For further information:

RBC Dexia:

Tracey Dawes-Lucas, Sydney, +(612) 8262 5011: [email protected]
Jason Graham, Toronto, [phone]; [email protected]