3

Helo, I am a Malaysia investor.

Recently, I invest in BP ADR from US market, through my local broking firm.

I was wondering, whether owning BP ADR, requires me to pay custody fee. What my understanding is, bank which issues the ADR, will charge a custody fee, by deducting it from the received dividend.

I cannot find a specified of such information from http://www.bp.com/subsection.do?categoryId=9032991&contentId=7060574, regarding BP ADR.

6

New SEC rules also now allow brokers to collect fees on non-dividend bearing accounts as an "ADR Pass-Through Fee". Since BP (and BP ADR) is not currently paying dividends, this is probably going to be the case here. According to the Schwab brokerage firm, the fee is usually 1-3 cents per share. I did an EDGAR search for BP's documents and came up with too many to read through (due to the oil spill and all of it's related SEC filings) but you can start here:

http://www.schwab.com/public/schwab/nn/m/q207/adr.html

  • So, does it mean it is wiser for me to invest in BP through London Stock Exchange instead of US, in order to save up the pass-through fee? As both are foreign investment for me (I am in Malaysia). – Cheok Yan Cheng Jan 1 '11 at 13:44
  • Also, is the ADR pass-through fee one time change? Or it will be charged continuous per annual as long as I am holding the ADR? – Cheok Yan Cheng Jan 1 '11 at 14:01
0

Rules appear to be changing (21NOV2014) Aviva Plc. AV on NYSE pass thru fee is 0.02 cents per ADR but that equals 11% deduction from ADR dividend. For utility or insurance stock that is significant ongoing fee. Registrar in US is Citibank, could be specific to them. This is the first for me except some modest fees on indonesian ADR. Information very difficult to find. Buy and hold OZ investor.

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.