Another important strategic move in 2007 was our decision to reduce the required minimum account balances and fees for Class B shares in our two indexed programs — the CUIT Core Equity Index Fund and the CUIT Small-Capitalization Equity Index Fund. Effective April 1, 2008, the investment management fee for the CUIT Core Equity Index Fund’s Class B shares will be reduced from the current 25 basis points to 15 basis points — a 40% reduction. The management fee for the CUIT Small-Capitalization Equity Index Fund’s Class B shares will fall from 35 basis points to 20 basis points — a 43% reduction. In addition, the Class B minimums for both Funds will be reduced to $3 million from the current $10 million. Qualifying participant accounts will automatically convert to Class B status on April 1, with the lower expense ratio. Economies of scale, particularly in our B share classes, have grown as asset levels have increased. Throughout our history, CBIS has worked to pass on achieved economies of scale to participating organizations. The fee reduction is also motivated by our desire to remove any barriers that keep Catholic organizations from integrating faith and finance through our Catholic socially responsible investment programs. In the past, some investment management consultants and Catholic institutions have told us they would like to invest with CBIS, but felt compelled to look for lower-cost alternatives. We hope the fee reductions remove that obstacle and better position us to compete for this business. Moreover, additional asset growth gives us greater leverage potential as shareholders when we engage corporate managements in dialogues regarding the issues that concern participants.
The fee reduction is also motivated by our desire to remove any barriers that keep Catholic organizations from integrating faith and finance through our Catholic SRI programs.