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NEWS ABOUT THE SALE OF MD FINANCIAL MANAGEMENT TO SCOTIABANK®

What happens to MD Financial Management now?

It’s business as usual at MD Financial Management. MD will operate as a distinct, stand-alone brand within Scotia Wealth Management® and MD will continue to operate with physicians at the heart of every decision. MD’s staff, advisory and management teams will remain in place and we expect that clients’ MD Advisor, Portfolio Manager, specialists and other members of their financial support team will stay the same. MD Advisors will continue to work on salary not commission and will not be required to sell Scotiabank products to MD clients. That means clients will receive the same independent, objective and client-centric financial advice and outstanding service they’ve come to expect from MD.

What has Scotiabank® committed to as part of this acquisition?

Scotiabank® has committed to:
  • Preserve the independent, non-biased, and client-centric approach of MD to financial advice.
  • Expand the breadth and depth of specialized financial advice for the physician community being offered through MD.
  • Deliver on a complete wealth management offering that addresses the entirety of a physician’s life – their family, their business and their future.
  • Partner with the CMA to deliver on its 2020 vision, investing in joint initiatives to support a vibrant profession and a healthy population.

How does MD’s leadership team feel about MD being sold?

MD’s Board and senior leadership believe that the acquisition by Scotiabank® brings advantages for MD clients as we will be able to retain all the aspects of our organization that make us unique, while delivering even more value to all of Canada’s physicians and their families. MD will function as a distinct, stand-alone brand within Scotia Wealth Management®, and MD will continue to operate with physicians at the heart of every decision. MD Advisors will continue to work on salary not commission and will not be required to sell Scotiabank products to MD clients. That means clients will receive the same independent, objective and client-centric financial advice and outstanding service they’ve come to expect from MD.

I chose MD Financial Management because I didn’t want to invest with a traditional financial institution. Why should I stay with MD now that it’s been sold?

At MD, we believe that the acquisition by Scotiabank brings advantages for MD clients because we will be able to retain all the aspects of our organization that make us unique, while delivering even more value to all of Canada’s physicians and their families. Scotiabank is firmly committed to preserving MD’s unique physician-specific approach to financial services and MD will function as a distinct, stand-alone brand within Scotia Wealth Management®. MD will stay true to its core mandate and continue to operate with physicians at the heart of every decision it makes. MD’s staff, advisory and management teams will remain in place, and physicians and their families will continue to enjoy the physician focused, independent, objective and client-centric financial advice and outstanding service they have come to expect from MD.

What does this sale mean for me as a client?

The sale is good news for clients. Becoming part of the Scotiabank® family will enable MD to retain all the aspects of our organization that make us unique, while delivering even more value to all of Canada’s physicians and their families. MD will function as a distinct, stand-alone brand within Scotia Wealth Management®, stay true to its core mandate and continue to operate with physicians at the heart of every decision it makes. MD’s staff, advisory and management teams will remain in place, and physicians and their families will continue to enjoy the independent, objective and client-centric financial advice and outstanding service they have come to expect from MD.

Moving forward, MD will be able to complement its existing products and services with the robust suite of category-leading banking products and services delivered by Scotia Wealth Management® and Scotiabank—and deliver even more value. Additionally, over time, Scotiabank intends to grow MD’s suite of services to meet more of the needs of physicians and their families at all stages of their lives and careers.

Will my assets now be managed by Scotiabank®?

No, your assets will continue to be managed by MD and MD will operate as a distinct, stand-alone brand within Scotia Wealth Management®.

Does the sale change how safe and secure my money is?

Nothing changes in terms of the safety and security of your money. MD will operate as a distinct, stand-alone brand within Scotia Wealth Management® and be subject to the same rules and regulations regarding clients’ assets as it was before the sale.

Will there be any changes to my fees or the MD fee structure?

We do not anticipate changes to MD’s fees or fee structure as a result of this acquisition. In fact, Scotiabank® is currently examining preferred pricing options as well as special products and services designed to meet the banking needs of physicians and their families at all stages of their lives and careers.

As a client, will I notice anything different?

MD will operate as a distinct, stand-alone brand within Scotia Wealth Management® and we expect the transition to be seamless for MD clients. MD will be able to retain all the aspects of our organization that make us unique, while delivering even more value to all of Canada’s physicians and their families. Scotiabank® is firmly committed to preserving MD’s unique physician-specific approach to financial services. MD will stay true to its core mandate and continue to operate with physicians at the heart of every decision it makes. MD’s staff, advisory and management teams will remain in place, and physicians and their families will continue to enjoy the independent, objective and client-centric financial advice and outstanding service they have come to expect from MD.

Moving forward, we expect to be able to deliver even more value to our clients. Becoming part of the Scotiabank family will enable us to complement our existing products and services with the robust suite of category-leading banking products and services delivered by Scotia Wealth Management and Scotiabank. Additionally, over time, Scotiabank intends to grow our suite of services and expand the breadth and depth of the specialized financial advice offered by MD, enabling us to meet more of the needs of physicians and their families at all stages of their lives and careers.

Will my MD advisor, portfolio manager, specialists and/or any of my other financial support team change?

We expect that your MD Advisor, Portfolio Manager, specialists and other members of your financial support team will stay the same. This means that you will continue to receive the same physician focused, high-quality, independent, objective and client-centric financial advice and outstanding service and support from MD.

Do I need to do anything differently as a result of this change in ownership?

No. MD will operate as a distinct, stand-alone brand within Scotia Wealth Management® and we expect the transition to be seamless for MD clients.

Will Scotiabank® merge the MD and Scotia Wealth Management® advisory teams?

At this time, there are no plans to merge the two advisory teams. Scotiabank® is firmly committed to preserving MD’s unique physician-specific approach to financial services and appreciates the in-depth knowledge of our highly skilled staff.

Will I continue to have access to same investment products and services, or will I be limited to those offered by Scotiabank®?

MD’s clients will continue to have access to the same investment products and services they had before the sale. MD Advisors will continue to work on salary not commission and will not be required to sell Scotiabank products to MD clients. That means clients will receive the same physician focused, independent, objective and client-centric financial advice and outstanding service they’ve come to expect from MD.

Moving forward, we expect to be able to deliver even more value to our clients. Being part of the Scotiabank® family will enable us to complement our existing products and services with the robust suite of category-leading banking products and services delivered by Scotia Wealth Management and Scotiabank. Additionally, over time, Scotiabank intends to grow our suite of services and expand the breadth and depth of the specialized financial advice offered by MD, enabling us to meet more of the needs of physicians and their families at all stages of their lives and careers.

Who will lead MD Financial Management after the acquisition?

Following the acquisition, MD will continue to be managed by its current management team led by Brian Peters, MD’s President and CEO. Brian will report to Alex Besharat, Senior Vice President of Scotia Wealth Management®.

Why were MD Financial Management’s clients and CMA members not informed of the sale in advance of the public?

Unfortunately, we were not able to alert MD clients or CMA members ahead of time because public knowledge would have destabilized MD, its clients and employees. Also, Scotiabank is a publicly-traded company and the nature of this transaction required confidentiality.

With the change in ownership, will MD services still be limited to CMA members?

No, as of June 1, 2018, MD’s services will be available to all Canadian physicians and their families, broadening access in support of the entire medical profession.

How will the sale of MD be advantageous to medical students and residents?

Students often need a full suite of banking services, including student loans, lines of credit and mortgages. Becoming part of the Scotiabank® family will enable MD to deliver an enhanced range of services for students, residents and physicians in their first five years of practice. If you currently have a SRLOC loan with MD and National Bank, the terms of your SRLOC loan will not change.

Were any staff let go from MD Financial Management as a result of this acquisition?

No. Scotiabank® is firmly committed to preserving MD’s unique physician-specific approach to financial services and appreciates the in-depth knowledge of our highly skilled staff. MD staff and the management team will remain in place.

Who made the decision to sell MD Financial Management?

The CMA, as the ultimate owner of the MD Group of Companies, made the decision to sell MD Financial Management.

Was the sale driven by under-performance or other financial issues at MD?

No. MD Financial Management is a strong and successful business, which was why there was such a high level of interest in the company and the CMA received several competitive offers for MD from leading Canadian financial institutions.

How and why was Scotiabank® selected as the buyer?

A comprehensive process was undertaken to identify the best and most suitable acquirer for MD. In selecting Scotiabank®, the CMA Board was focused on securing a strong future for MD and its clients, and prioritized wealth-management performance, client service, alignment of vision, respect for employees, and ongoing support for the CMA’s future direction.

How much was MD Financial sold for?

MD Financial Manage was sold for $2.585 billion. The sale is subject to regulatory approvals and closing conditions, and the transaction is expected to close in fiscal Q4 2018.

How many offers did the CMA board receive? Who were the other bidders?

Due to the confidential nature of the process, we cannot disclose the details of the other bids. We can tell you that several competitive offers were received for MD from leading Canadian financial institutions.

Did the CMA Board take the highest offer price?

Due to the confidential nature of the process, we cannot disclose the details of the other bids. We can tell you that a fair offer price was only one of many considerations in the selection process. In selecting Scotiabank®, the CMA Board was focused on securing a strong future for MD and its clients, and prioritized wealth management performance, client service, alignment of vision, respect for employees, and ongoing support for the CMA’s future direction.

Is the transaction subject to regulatory approvals?

The sale is subject to regulatory approvals and customary conditions. We expect the sale to close in Q4 of 2018. Scotiabank® will follow the approval process and will work with regulators to ensure their requirements are met in as efficient and timely a manner as possible.