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More Canadians saving, more money being saved
Survey also reports strong RRSP investment intentions
WINNIPEG - A record-breaking 75 per cent of Canadians own RRSPs according to the sixth annual RRSP Investment Intentions poll from Investors Group. RRSP ownership has increased from 64 per cent last year, the second consecutive year this number has grown by 10 points or more.
Among Canadians who already have a RRSP, or plan to start one this year,
three-quarters plan to contribute the same or more to their RRSP portfolios in
the 2007 tax year than they did in 2006.
RRSP contributions strong across all age groups
Contribution intentions are strongest among respondents 55-years of age
and under. Seventy-eight (78) per cent of Canadians aged 25 to 34 plan to
contribute the same or more than they did last year. This number jumps to
82 per cent among 35 to 44 year olds and to 84 per cent among 45 to
54 year olds.
With older adults saving for their rapidly approaching retirement years,
the message about saving seems to be getting through to the younger
generation, as well. A strong majority of Canadians aged 25 to 34 (60 per
cent) indicate they have an investment portfolio.
Canadians confident about debt in retirement
Investors Group's RRSP Investment Intentions Poll found more than
one-third of non-retired Canadians (35 per cent) plan to carry up to $100,000
in debt into retirement. Among those planning to carry debt into retirement,
45 per cent say it will be in the form of credit cards, lines of credit or
personal loans, and 28 per cent say it will be for a mortgage on a primary
residence.
"A focus on saving while carrying debt may seem contradictory, but it
also suggests Canadians are balancing their lifestyles today against their
plans for the future," says Debbie Ammeter, Vice President, Advanced Financial
Planning, Investors Group. "Most households carry monthly financial
commitments, such as mortgages, car loans, and credit card payments. The
challenge is finding the right comfort level in this balancing act."
"Factors contributing to a greater comfort level among Canadians in
managing debt include historically low interest rates, a healthy Canadian
dollar and strong market performance," says Ammeter.
Home equity supplementing retirement income
The recent strength of the Canadian housing market may also influence how
Canadians plan to fund their retirement. One-in-five non-retired homeowners
(19 per cent) plan to use home equity to generate retirement income.
Of those hoping to generate income from their home equity, 40 per cent
believe their home will contribute between 10 and 30 per cent of their
retirement income. Some of the most popular home equity strategies this group
will consider include selling their home and buying something smaller
(54 per cent); taking out a line of credit secured by home equity
(22 per cent); taking out a reverse mortgage (15 per cent); or selling the
home and renting (seven per cent).
A total of 2,055 surveys were completed with Canadian adults between
September 4th and September 13th 2007, using the Harris Decima online panel. A
sample of 2,055 respondents provides estimated proportions that are accurate
to within, at most, +/- 2.2% at the 95% confidence level. That is, 95 times
out of 100, the real value of the variable in the total population will lie
within +/- 2.2% of the estimated proportions provided by the sample. One time
out of 20, the real value of the variable in the population will fall outside
this range.
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Are Canadians Spenders or Savers?
New ING DIRECT survey shows spenders edged out savers, yet Canadians
demonstrate positive savings habits
TORONTO - When asked to classify themselves as either a spender or saver, 55% of Canadians said they were spenders, versus 46% who said they were savers. However, in digging a little deeper into Canadian savings habits it was revealed that even spenders save regularly: 55% of Canadians said they save regularly while many practice the most common sense approach to saving, 'paying yourself first'. Almost forty percent (38%) indicated they use some form of automatic plan to save their money.
Contrary to the opinion that Canadians are no longer savers, a new
research study released today by ING DIRECT reveals that good, old fashioned
savings habits are alive and well in Canada. And whether we realized it or
not, those healthy habits were nurtured during our upbringing.
Fifty-six per cent of Canadians said they were raised in a family that
encouraged saving versus spending (10%). Of those that were raised to be
savers, more than half (54%) feel they are still good savers today, versus
less than a third (31%) who were brought up in homes where spending was more
prevalent. The research conducted online by Ipsos-Reid surveyed 1,582
Canadians with a bank account at a financial institution.
The research also revealed that 57% of respondents opened their first
savings account before they reached their 15th birthday. And, 43% indicated
their mothers or fathers were most influential in teaching them about saving
money.
Despite the good habits that are practiced by many, the survey also
reveals that not all Canadians are taking advantage of some very practical
ways to save. For example, only 72% have a savings account. Furthermore, of
those that do have a savings account, almost half (48%) do not have one that
pays a high-interest rate of 3% or more. In fact 32% said they save using a
chequing account. Another sixty-one per cent of Canadians feel that they pay
more in service charges than they receive in interest.
"We were the first to offer the Investment Savings Account in Canada and
have been encouraging all Canadians to save their money for more than a
decade," said Mark Deep, Head of Marketing at ING DIRECT. "While we're
encouraged the message is getting through to many, we know we still have a lot
of work to do in helping Canadians understand the value in having a
high-interest savings account that has no fees, service charges or minimums.
Regardless of how much people are able to save or what they're saving for,
there are many ways to make the most of the money they have. It was surprising
to learn that many Canadians are still saving using low rate savings accounts
and chequing accounts which pay virtually no interest with fees that eat away
at any interest they earn."
The survey also revealed what Canadians are saving for. For example, 58%
indicated that they were saving for retirement followed by travel (38%), a
vehicle (25%) and a house/condo (24%). And contrary to the spending culture we
often hear about, 57% of those surveyed said they save for the things they buy
and only buy if they have the money to pay for it (56%) versus the 20% who
believe in buying now and paying later.
"Thirty-four per cent of respondents told us it's getting harder for them
to save and almost half said they want to save more but don't have enough
money left over," said Deep. "But there are some encouraging signs. When we
asked if they were prepared to make any changes to their lifestyle to help
them save money, many indicated that there were several small things they
could do to save more. Simple things like not buying that morning coffee every
day or eating out less often can easily generate a few extra dollars in
savings every month. Add an account with a great interest rate, and no fees,
and then you're really saving your money."
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Signs You're a Good Saver
- You have a regular, automatic transfer set-up into a savings or
investment account. (38% of respondents)
- You save regularly. (55%)
- You save up for the things you buy. (57%)
- You make time to think about and plan for your savings goals. (53% of
people have time)
- You have a high-interest savings account, with no fees or minimums
that pays at least 3% interest. (35% of those with savings accounts)
Signs Your Saving Habits Need Help
- You live by the phrase, "Buy now. Pay later." (20% of respondents)
- You don't have a savings account. (28%)
- You don't have a savings account that pays high-interest. (48%)
- You use your chequing account to save. (32%)
- You pay more in fees than you receive back in interest. (61% of
Canadians believe this to be the case)
- You don't have enough time to think about or plan for your savings
goals. (17%)
- You don't save - regularly (25%), at all (11%).
>>
The survey findings are the results of an Ipsos Reid/ING DIRECT online
poll conducted from October 23, 2007 to October 29, 2007 with a representative
sample of 1,582 Canadian bank account holders. With a sample of this size, the
results are considered accurate to within +/-2.5 percentage points, 19 times
out of 20, of what they would have been had the entire Canadian adult
population been polled. The margin of error will be larger within regions and
for other sub-groupings of the survey population. These data were weighted to
ensure the sample's regional and age composition reflects that of the actual
Canadian population according to Census data.
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Ladies: When it comes to investing, are you a Panicked Paula or a Confident Kate? Poll finds four distinct personality types among female investors
- Most Canadian women are disengaged from investing, conservative and risk-averse
- Yet more than half are happy or satisfied with their investments
TORONTO - Four distinct investor types emerge from the 2007 TD Waterhouse Female Investor Poll, a comprehensive annual study of Canadian women's attitudes towards investing. They provide a psychological profile of how women perceive themselves in terms of engagement and satisfaction when it comes to their role as investors.
"Successful investors are usually confident investors, and vice versa,"
says Patricia Lovett-Reid, Senior Vice-President, TD Waterhouse. "And so this
year, we decided to use our Female Investor Poll to map women's levels of
confidence in investing and understand what's going on in Canadian women's
minds when it comes to their investments."
Researchers used a simple formula (Engagement + Satisfaction =
Confidence) to analyze responses to two specific questions: how engaged are
you in investing, and how do you feel about your investments. From the data
gathered, they arrived at a 'Confidence Map' of the Canadian female investor.
The poll, conducted by TNS Canadian Facts among 995 Canadian women, found
four investor personality types: Panicked Paula (36% of respondents), Blissful
Betty (34%), Sleepless Sally (11%) and Confident Kate (19%).
Panicked Paula: overwhelmed and confused
Panicked Paula is disengaged from the process of investing, paying little
or no attention to what goes on in financial markets, yet is still worried
about the state of her investments. This investor type tends to be younger
(33% are age 25-35) and less than one-in-ten have a financial plan. Not
surprisingly, most (62%) have a low tolerance for risk, and, at $55,400, they
have the lowest average household assets among the four personality types.
"Clearly Panicked Paula is overwhelmed and confused by investing,"
comments Lovett-Reid. "That's not unusual, especially among younger women or
those who are forced to get more engaged in their investments due to a sudden
change in lifestyle. The most important thing for this investor is to take the
first step. Meeting with a financial planner would do wonders to build both
her confidence and her knowledge."
Blissful Betty: disengaged, yet happy
Blissful Betty, like Panicked Paula, is detached from the investment
process and pays little or no attention to it. Yet unlike Paula, this doesn't
worry her. On the contrary, she is feeling confident. Blissful Betty comes in
all ages and has average household investment assets of $107,500. She is twice
as likely as Panicked Paula to have a financial plan (one in five vs. one in
ten) and has a low risk tolerance (57% define themselves as low risk).
Blissful Betty worries Lovett-Reid. "Is she happy-go-lucky because she
has delegated all responsibility for her investments to someone else? Or
perhaps she hasn't considered the possibility that her life could take an
unexpected turn such as divorce or outliving her financial assets? Either way,
Blissful Betty needs to get more engaged in investing. Even if she has a
trusted advisor managing her investments, she needs to be involved in the key
decisions."
Sleepless Sally: engaged, yet worried
Although Sleepless Sally is knowledgeable, diligent and engaged in
investing, she still worries about her investments. She is somewhat older than
Panicked Paula (more than a third are age 36-45), and has, on average, more
household investment assets ($137,200) than either Panicked Paula or Blissful
Betty. One-in-four Sleepless Sallys have a financial plan.
For the 75% of Sleepless Sallys who don't yet have a financial plan,
Lovett-Reid asks: "What are you waiting for? Without long-term objectives and
a portfolio strategy to meet them, you are living and investing day to day -
and that is a recipe for insomnia."
Confident Kate: engaged and confident
Confident Kate is engaged in the world of investing, has taken action to
ensure her financial security, and is happy about what she has achieved. She
is typically older (four-in-ten are age 56-69) and has more than four times
the household investment assets as Panicked Paula ($240,900 vs. $55,400). Half
of this group has a financial plan and they have the highest tolerance among
all groups for assuming a medium level of risk (57%).
"Confident Kate is at a place all female investors should strive for:
she's interested and engaged, confident and successful," says Lovett-Reid.
"This is a wonderful place to be. My only concern is that I would have liked
the Confident Kates to get here sooner. It seems like the classic case of
'with age comes wisdom'. From a financial perspective, wisdom and confidence
really come from being engaged and making finances a priority."
<<
More Key Findings:
- Seventy percent of respondents have little or no interest in
investing, and pay scant attention to what is going on in financial
markets. Among this group, roughly half are Blissful Bettys and half
are Panicked Paulas.
- Fifty-three percent of women overall are happy with their
investments, yet only one-in-five (19%) are also engaged and
interested in investing.
- Sixty-six percent of women are married or living in common law
relationships - this is the highest, at 70%, among Blissful Bettys.
Yet only 16% of all poll respondents and only 15% of Blissful Bettys
have a financial contingency plan for divorce. This compares with
Statistics Canada's latest (2003) findings on marriage that indicate
38.3% of marriages will end in divorce by the 30th wedding
anniversary.
>>
"On the whole, our 2007 poll found Canadian women investors to be
somewhat less engaged than they should be in the world of investing,"
concludes Lovett-Reid. "They are conservative with their finances, and very
few will assume high risks. As they get older, they naturally become more
active and sure of themselves."
"The challenge for financial advisors is to help women who are
disengaged, perhaps lacking in confidence and younger in age to get in the
game sooner and realize the benefits of a long-term investment horizon."
The 2007 Female Investor Poll was conducted for TD Waterhouse using TNS
Canadian Facts' online panel. Respondents for the survey were women aged 25 to
69 who have sole or shared responsibility for household financial planning or
investment decisions. A total of 995 women participated in the online survey
between September 14th and 19th, 2007. Final data are weighted to be
representative of women by age and region.
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‘The Art & Science of Valuation at Different Stages of Company Development’
Tuesday, February 19, 2008
1:30 pm- 5:00 pm EST
Toronto – Networking Lunch at 12:30 pm
This event will be video conferenced into Vancouver, Calgary, Winnipeg, Ottawa, Montreal, Quebec City, Halifax and Fredericton
Toronto - This session will explore the principles, concepts and issues related to the valuation of companies from time of initial investment (at various stages) through to time of exit. Within this discussion will be weaved anecdotal accounts and examples of the various valuation methods employed by angel, venture capital, private equity and strategic investors/acquirers. The impact of the current economy and capital markets on the valuations of private companies will also be presented. Our speakers include:
David Adderley, Partner & COO, Celtic House Venture Partners
Sandra Bosela, Partner, EdgeStone Capital Partners
Tim Lee, Senior Vice President, Investments, GrowthWorks Capital
Sanjay Nakra, Managing Director and Team Head, TD Securities
Gemma Postlethwaite, Vice President, Thomson Financial
Beth Shiferaw, Vice President, ONCAP
Chris Wormald, VP Strategic Alliances, Research in Motion
Andrew Wilkes, Chairman, National Angel Organization
This event will be invaluable to private equity and venture capital investors, entrepreneurs, service providers and finance professionals.
Please see agenda attached. Register now as we expect a sell-out event!
<http://www.cvca.ca/news/events/PD_Registration_2007.aspx> ON-LINE REGISTRATION IS NOW OPEN
Special Discount:
4th Person from the same company free!*
*Special Discount: In Toronto the 4th person from the same company is free: Video conference attendees may spread discount over other sites.
CVCA gratefully acknowledges the generous support of its PD 2007/08 Series Sponsors:
PricewaterhouseCoopers
McCarthy Tétrault LLP
Chubb Insurance and HKMB International Insurance Brokers.
CVCA - Canada's Venture Capital & Private Equity Association
MaRS Centre
Heritage Building
101 College Street, Suite 120-J
Toronto, ONTARIO
Canada, M5G 1L7
Phone 416 487-0519
Fax 416 487-5899
E Mail <mailto:cvca@cvca.ca> cvca@cvca.ca Web Site <http://www.cvca.ca/> www.cvca.ca
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Only One in Five Companies Produce a Reliable Forecast, Despite Investing Significant Time, says KPMG Study
Executives estimate that inaccurate forecasts have cut their share price by six per cent over three years
TORONTO-
All organizations use forecasts to predict and manage their future performance yet only 22 percent came within five per cent of their projections, according to the results of a global study initiated by KPMG LLP.
The research study, entitled: Forecasting with Confidence, was conducted by the Economist Intelligence Unit (EIU) on behalf of KPMG International and was based on the replies of 544 senior executives, 30 per cent of them Chief Financial Officers. Respondents were drawn from a cross section of industries and 59 percent were from organizations with over US$1 billion in annual revenue.
The study shows that unreliable forecasts cost organizations money. On average forecasts over the last three years have been out by 13 per cent. Executives in the survey estimate that such errors have directly knocked six per cent off their share prices over the same period, mainly because of investor reaction.
"Earlier research by KPMG had already told us that CFO's were unhappy with their current forecasting capabilities," said John Herhalt, Practice Leader, Operations Improvement, KPMG Advisory Services. "By digging deeper in to this critical finance function, we see very clearly that those companies that do meet forecasting targets are high performing companies able to make better decisions about their future. It is obvious that good forecasting pays."
Highlights from the study include:
- Firms with forecasts that came within five percent actual saw share prices increase by 46 per cent over the last three years, compared with 34 per cent for others
- Despite the fact that leaders demand accurate forecasting, companies are much more likely to outperform rather than under perform their predictions. Possible reasons run from "sandbagging" to protecting bonuses
- Outperforming the forecast means that important decisions such as resourcing and investment choices are being made on the basis of inaccurate or incomplete information
- Almost 50 per cent of companies surveyed believe the reliability of their financial data for forecasting is merely adequate or worse; a majority think the same of their non-financial data
- Organizations largely use internally generated data - only 40 percent use government economic reports. Two out of the four areas where companies say they make forecasting errors are consumer demand and economic drivers - both of which could be helped by readily available external data
- Information technology is too often a hindrance not a help
"What emerges clearly from this study is that high-performing companies usually take the forecasting process very seriously," said Stephen Spooner, Western Practice Leader, KPMG Advisory Services. "Armed with better quality, forward-looking information, executives at these organizations are able to make better decisions about the future direction of their business."
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New Globe Investor magazine helps Canadians create, manage, guard and build wealth
TORONTO - The Globe and Mail, Canada's national newspaper, launched a new quarterly publication. Geared toward the educated investor, Globe Investor magazine offers ideas, alternatives and inspiration for investing at home and internationally, and helps readers understand the markets, strategize, be decisive and stay on course.
"Investing is about building wealth, security and prosperity over a
lifetime," said Scott Adams, editor, Globe Investor magazine. "Whether they
are a do-it-yourselfer or working with a financial adviser, Globe Investor
gives investors direction, ideas and perspectives to help them get started,
make the next trade and improve their strategies."
The premiere issue of Globe Investor magazine debuts tomorrow with exclusive profiles, interviews, perspectives and tips for Canadian investors. Highlights of the Fall 2007 issue include:
- The greatest mutual fund manager ever - The odds of beating the S&P
500 Index for 15 years running has been pegged at 2.3 Million to one.
Wall Street's Bill Miller is the one. Globe and Mail business writer
Derek De Cloet talks to the man behind the phenomenal streak to find
out how he did it.
- The ten commandments of investing - The Globe and Mail's personal
finance columnist Rob Carrick lays out the best nuggets of investing
insight from legends in the field. From stock market risk to which
mutual funds to buy, wisdom that you can understand and profit from.
- How to legally earn $66,000 a year, tax-free - Dividends are the clear
winner. Report on Business columnist John Heinzl shares the secret to
tax-free living: leveraging the dividend tax break to earn a five-
figure income without paying any tax.
- Insights from the Wealthy Barber, the 12-step formula for fuelling hedge funds, seasonal investing, how to pick art that is going to soar in value, and more.
Globe Investor is Canada's only magazine dedicated to the educated
investor. Available online at globeinvestormagazine.com, Globe Investor
magazine offers insightful content to help Canadians create, manage, guard and
build wealth.
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Canadians continued to divest foreign securities in September 2007
Shedding a significant $4.5 billion worth
This followed a record $7.1 billion divestment in August. In both months, this activity was mainly due to a substantial disposition of foreign money market instruments. Meanwhile, non-residents removed $5.2 billion worth of Canadian securities from their holdings, split almost equally between bonds and equities. September marked the fifth consecutive month in which non-residents divested from Canadian securities.
Heavy divestment by residents in foreign money market instruments for the second month
Canadians disposed of $4.4 billion worth of foreign money market instruments in September, adding to August's record divestment of $7.0 billion. In both months, the divestment was focussed on non-US foreign paper.
Currency-wise, the reduction in holdings in September was equally split between Canadian dollar-denominated and US dollar-denominated foreign paper. However, over 80% of August's divestment was in Canadian dollar-denominated foreign paper.
On a sector basis, over 60% of the divestment was in money market instruments issued by foreign banks. In addition, Canadians disposed of $605 million worth of US treasury bills, following investments totalling $1.1 billion in these instruments in July and August.
Residents also dispose of foreign bonds
Canadians trimmed $940 million worth of foreign bonds from their holdings in September, following a similar divestment ($1.1 billion) in August. Residents had been investing an average $4.1 billion per month from December 2005 to July 2007.
Over the month, Canadians sold $1.1 billion worth of US government bonds, continuing the divestment trend started in June. In September, the prices of US government benchmark bonds soared in response to the deep cut in interest rates by the US Federal Reserve. The majority of the sales in September involved bonds with shorter term to maturity (2 to 5 years) compared to August (5 to 10 years).
Currency-wise, residents sold $341 million worth of maple bonds (Canadian dollar-denominated foreign bonds) in September, the second consecutive month of divestment in these instruments.
Canadians buy US equities
Residents continued to acquire foreign corporate shares for the 12th consecutive month, adding $792 million worth in September. Investment centred on US equities as residents acquired $944 million worth.
Decrease in foreign holdings of Canadian bonds due to record retirements
Foreign investors cut $2.6 billion worth of Canadian bonds from their holdings in September. This reduction was due to a record level of net retirements ($6.5 billion), as non-residents invested $4.2 billion in outstanding bonds. Net retirements were mostly in Canadian dollar-denominated bonds, and were split between federal and provincial government bonds, as well as federal government enterprise bonds.
The $4.2 billion foreign investment in outstanding bonds was composed mainly of Canadian dollar denominated-bonds issued by the federal government ($1.5 billion) and its enterprises ($2.7 billion).
Non-residents buy US dollar-denominated Canadian money market paper
Foreign investors bought $303 million worth of Canadian money market paper in September, switching from two months of divestment totalling $1.5 billion.
September's investment was largely in federal enterprise paper ($589 million) and other Canadian corporate paper ($283 million). Meanwhile, non-residents disposed of $572 million worth of government treasury bills.
On a currency basis, all foreign investment was in US dollar-denominated paper ($498 million worth), as non-residents divested $274 million worth of Canadian dollar-denominated foreign paper. In September, the Canadian dollar strongly appreciated against its US counterpart and reached its highest level in the past three decades.
More divestment in outstanding Canadian stock
Non-residents sold $2.9 billion worth of Canadian stocks in September, despite a rebound in Canadian equity prices. This closes the third quarter of 2007 with a record divestment of $8.5 billion worth. September's reduction in foreign holdings was mainly in outstanding Canadian stocks as non-residents sold $2.4 billion worth. Geographically, American and European investors sold $1.4 billion and $1.8 billion worth respectively.
Related market information
In September, Canadian short-term interest rates increased by 14 basis points to 3.97%, while US short-term rates dropped 31 basis points to 3.89%. The resulting differential of 8 basis points caused short-term rates to favour investment in Canada for the first time since February 2005.
Both Canadian and US long-term interest rates inched up in September, by 3 and 6 basis points respectively. Canadian interest rates stood at 4.41%, while US rates rose to 4.63%. The resulting differential between the two countries increased to 22 basis points in favour of investment in the United States.
After three consecutive months of decline, Canadian stock prices rebounded 3.2% in September, as the Standard and Poor's / Toronto Stock Exchange Composite Index closed the month at a record 14,098.9. Meanwhile, US stocks gained 3.6% in September with the Standard and Poor's Composite Index reaching 1,526.8 at month's end.
The Canadian dollar hiked 5.8 cents US in September, the second highest monthly increase on record. The Canadian dollar traded for $1.005 US, the highest level since November 1976. At the end of September, the Canadian dollar had increased 15.56 US cents since the beginning of 2007.
Definitions
The data series on international security transactions cover portfolio transactions in stocks, bonds and money market instruments for both Canadian and foreign issues.
Stocks include common and preferred equities, as well as warrants.
Debt securities include bonds and money market instruments.
Bonds have an original term to maturity of more than one year.
Money market instruments have an original term to maturity of one year or less.
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NASDAQ Proposes Amendment to Its Rules to Allow Companies
Full Benefit of This Change
NEW YORK - The Nasdaq Stock Market, Inc. announced it fully supports the Securities and Exchange Commission's (SEC) decision to allow non-U.S. companies to file their financial statements with the SEC using International Financial Reporting Standards (IFRS). The SEC's new rules eliminate the need for non-U.S. companies to reconcile their financial statements prepared under IFRS with U.S. Generally Accepted Accounting Principles (U.S. GAAP).
To enable NASDAQ-listed companies to take full advantage of this
change, NASDAQ today submitted a proposal to the SEC to allow non-U.S.
companies to satisfy NASDAQ's financial listing requirements using
IFRS. NASDAQ's filing will be subject to public comment and must be
approved by the SEC.
"The SEC's action will help increase the attractiveness of the U.S. as
a place to raise capital," said Bruce Aust, Executive Vice President of
NASDAQ's Corporate Client Group. "It removes unnecessary costs and
steps that create barriers to attracting international companies. The
SEC's decision clearly communicates that the U.S. markets are dedicated
to wringing the cost and inefficiency out of doing business in the
U.S."
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Socially responsible investing on the rise in Canada
INSTITUTIONAL INVESTORS USE MARKET FORCES TO EMPOWER CANADIAN YOUTH: More
Than $1.2 Million Raised To Date
National Bank Financial's Little Giants Day on November 20th aims to
raise more than $650,000
TORONTO - In honour of Canada's National Child Day, National Bank Financial wants to demonstrate how the Canadian investment community uses market forces to achieve socially responsible objectives in Canada. Institutional clients across the country will once again be asked to support Little Giants Day on November 20. National Bank Financial intends to raise more than $650,000 for Canadian youth. This would bring the total proceeds raised for the three editions of Little Giants Day to over $1.8 million.
According to Canada's Social Investment Organization, assets invested
based on socially responsible guidelines have increased significantly in
recent years, from $65 billion in 2004 to $503 billion in 2006. This reflects
a deeper understanding within the Canadian financial community of the
relationship between social and environmental issues and investment risk and
return.
In 2006, a survey conducted by National Bank Financial revealed that the
majority of clients were interested to learn more about socially responsible
investing (SRI) in order to reconcile their values with their investments.
Since then, the firm's investment advisors have been working with clients in
this area via a number of SRI-oriented mutual funds and a dedicated mandate
within its Ambassador Portfolio Service.
"We believe that social responsibility is a theme that will be subscribed
to by an increasingly large number of investors going forward," said Michel
Falk, Executive Vice President, Individual Investor Services at National Bank
Financial. "Our firm has a dedicated SRI committee in place to help clients
'vote with their money' by investing in companies that espouse the values that
are most important to them."
Changing Lives through Microfinance
Inspired by the 2004 tsunami in Southeast Asia, the firm organized its
first Little Giants trading day in May 2005 to help to pull a Sri Lankan
school out of the wreckage and turn it into a model for the future, supported
by micro-credit programs for the women of the village. The firm has since
become one of the most committed financial institutions in the country when it
comes to leveraging market forces to invest in children's futures.
National Bank Financial partnered with the Canadian-based children's
charity Free The Children - the world's largest network of children helping
children through education - to implement these programs. All 125 women
involved in the micro-credit program now have a stable and sustainable source
of income and contribute significantly to rebuilding their families, community
and economy in the aftermath of the tsunami. This increased income has been
translated into greater quantity and quality of food for their families and in
ensuring that the women's children remain enrolled in school.
Before becoming a beneficiary of the program, Mrs. Selvarajah struggled
at subsistence level with a meagre household income of barely $2.00 a day.
Today, she earns an average of $9.00 each day through the food processing
business she started with the loan provided by National Bank Financial. "For
the first time, I feel that I can accomplish anything. It is a new beginning
for me. I am so thankful to National Bank Financial and all those who made
this program possible," Said Mrs. Selvarajah.
A Call to Action on November 20th
National Bank Financial calls on all institutional investors to reaffirm
their support for this important initiative and take part in the 2007 edition
of Little Giants Day on Canada's National Child Day next week.
"We believe that every child has the potential to make a gigantic
difference in the world, which is why our firm has agreed to forego all net
institutional commissions on November 20th to inspire and empower our 'Little
Giants' to change the world," said Gerry Throop, Executive Vice President and
Managing Director, Global Institutional Equities at National Bank Financial.
"We would like to thank these institutional investors for helping us make a
tangible difference in the lives of so many women and children around the
world."
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Survey indicates overwhelming support for a single national securities regulator
TORONTO - An overwhelming majority of members of the Prospectors and Developers Association of Canada (PDAC) want a single national securities regulator and uniform securities laws across Canada.
In addition, 75% of those surveyed expressed their desire for the
introduction of a separate set of securities laws for junior companies that
are less complex, costly and time-consuming than existing securities laws.
In a recent membership survey conducted on behalf of PDAC by Angus Reid
Strategies, 88% of those surveyed said they wanted a single national
securities regulator. The online survey was conducted among a representative
sample of 255 members from September 21, 2007 to October 10, 2007. The results
are accurate within a margin of error of +/- 6.0%, 19 times out of 20.
Almost half of respondents expressed dissatisfaction with the provincial
securities commissions. The survey found moderately positive ratings for the
current Passport System. However, when asked to choose between a continuation
of the Passport System with Ontario as a participant and a single national
securities regulator, 62% preferred a single national regulator and
10% preferred an Ontario-inclusive Passport System - 28% were unsure.
Respondents believe that the advantages of a single regulator will
include reduced cost, reduced compliance times and increased international
competitiveness.
Patricia Dillon, President of the PDAC, said, "The PDAC has been a long
time supporter of the establishment of a single regulator with meaningful
regional representation. We have also supported the introduction and reform of
securities laws in order to facilitate raising capital and minimize the costs
of regulatory compliance. The results of this survey clearly demonstrate that
PDAC members consider securities reform to be a priority issue."
<<
Highlights from the survey include:
- securities laws should be uniform and applied consistently across
Canada, without opting out provisions;
- securities laws applicable to junior companies must be simpler and
compliance with these laws must be less costly and consume less
management time;
- there should be increased emphasis on the enforcement of securities
laws;
- 88% of PDAC members support the establishment of a single securities
regulator;
- PDAC members overwhelmingly prefer a single securities regulator
compared to the Passport System;
- There is strong support for some specific features of a single
national regulator:
- the consistent application of securities laws in all provinces and
territories;
- an ombudsman to receive complaints from issuers and investors; and
- regional offices across Canada with decision-making authority and
the power to provide discretionary relief.
>>
A copy of the survey results and the online survey questionnaire are
available at www.pdac.ca.
The PDAC is a national organization whose membership consists of
approximately 7,000 individuals and corporations who are engaged in mineral
exploration and mining activities throughout the world.
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Towers Perrin Survey Shows Improved Preparedness for Principles-Based Regulation and Increased Use of Market-Consistent Reporting
CFOs Foresee Dramatic Change in Competitive Landscape
STAMFORD, CONN. - CFOs report far greater understanding of principles-based regulation than they did in 2006 and are making notable progress in preparing for the new regulation, according to the latest survey of Life Insurance CFOs by the Tillinghast insurance consulting practice of Towers Perrin.
While only 8% of CFOs surveyed consider themselves very knowledgeable
about principles-based regulation, all of the rest understand at least the
basics. Furthermore, 42% say that planning is well under way, and 12% have
either largely implemented or are establishing a structure for migrating from
a formula-based approach for reserves and capital to a principles-based
approach. By contrast, last year's survey found that nearly half of
respondents (44%) knew very little or were not at all familiar with the
regulations, and only 17% had any planning under way.
The survey, the third of its kind administered in 2007, explored how
familiar CFOs are with International Financial Reporting Standards (IFRS),
fair-value reporting and principles-based regulation, as well as the projected
impact each will have on their companies and their ability to compete. In
addition, CFOs were asked about their company's financial performance compared
to the same quarter last year.
"Companies are rising to the challenge and are making progress in
educating themselves about and preparing for the upcoming regulatory changes,"
said Hubert Mueller, Principal and CFO Survey Leader at Towers Perrin. "What's
more, this increased knowledge is evident throughout the company, not just at
the highest levels, which further demonstrates the seriousness of CFO
commitment to the new regulation."
CFOs Foresee Challenges
Nevertheless, while the vast majority of companies surveyed agree that
principles-based regulation is needed (80%), most also have concerns about
implementation. This is consistent with findings from last year, when 82% were
in favor of regulation, but expressed implementation concerns. Furthermore,
many companies are pessimistic about when principles-based regulation will be
fully implemented for capital and reserves, with the majority saying it won't
happen until 2010 or later.
"After seeing data indicating momentum in planning for principles-based
regulation, we were interested to find that most CFOs don't really expect it
to happen for several more years," said Jack Gibson, Managing Principal for
the firm's North American life insurance practice. "While there have been
delays over the variable annuities reserve standard, we project the timeline
for full implementation to be shorter than most respondents'. It's therefore
important that CFOs recognize that this is a big job and are planning
accordingly."
Most respondents believe that principles-based regulation will
dramatically change the competitive landscape for life insurers. Nearly all
respondents (87%) think there will be a greater need to develop hedging
programs in response to the regulation, and nearly 80% are concerned about the
ensuing inability to compare results across companies. Additionally,
respondents believe the regulation will make dealing with regulators and other
external parties more costly and complex, forcing them to increase resources.
Finally, 75% of respondents foresee a greater need for modeling resources and
capacity with respect to their risk management framework.
Market-Consistent Reporting Gaining Ground
The use of market-consistent reporting methods is rapidly increasing, as
44% of the companies surveyed are already preparing some financial reports
using a market-consistent basis now or plan to do so within the next three
years. The most popular applications for reporting on a market-consistent
basis are embedded value, value of new business and economic capital.
Views vary, however, on some of the details about what constitutes a
market-consistent valuation. While almost all respondents (95%) agreed that it
was undesirable for policyholder liabilities to be reduced to reflect the risk
of the company defaulting on its obligations, they were split on whether
policyholder liabilities should be increased to reflect deemed profit margins
on any separately identifiable service element of a contract, with 40%
agreeing they should. There were also divergencies of view on the correct
allowance to be made for future premiums, whether expenses should be related
to market- or entity-specific levels, and whether liabilities should be
subject to a surrender value floor.
"These divergencies of view are mirrored in the wider practitioner
community and among the accounting regulators," according to Peter Wright, a
Principal with the firm's London office who leads the firm's worldwide working
party tracking progress with the IASB's insurance project. "It would require a
great deal of work to achieve consensus and, in the end, it may be necessary
to impose a solution in some cases."
Knowledge of IASB Discussion Paper Still Lacking
More than 100 countries have joined the IASB's project toward
implementation of Phase II of IFRS. With the FASB's decision about whether to
join with the IASB on IFRS Phase II less than a year away, 56% of CFOs
surveyed say they understand the basics of the IASB discussion paper, but very
few (8%) consider themselves very knowledgeable. That said, many are engaged
and are taking an active role in shaping the key issues, with more than half
planning to or considering responding to the IASB or FASB with comments on the
IASB Discussion Paper, Preliminary Views of Insurance Contracts.
"We believe the increasing emphasis on fair value and the expected
consensus between the IASB and FASB on Phase II of IFRS will lead a growing
number of North American life insurers to consider market-consistent embedded
value as a supplementary reporting metric for performance measurement and
external reporting", according to Mueller.
CFOs' Outlook Calls for Moderate Growth
Comparable to last quarter, 60% of respondents predicted growth of four%
or higher in new life and annuity premiums over the same quarter last year.
GAAP net revenue and GAAP net income will each increase by 4% or more,
according to 63% of respondents.
The CFO Survey Growth Indices indicate a slight uptick in CFOs' forecasts
for year-over-year growth in new life and annuity premiums and GAAP net
revenue, and a slight decline for GAAP net income. While CFOs' outlook for
premiums and GAAP net revenue has not changed much over the past year, their
outlook for GAAP net income has been somewhat more volatile.
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The PORTAL Alliance to Create Industry-Standard Facility for
144A Equity Securities
NEW YORK - A group of leading securities firms and The Nasdaq Stock Market announced November 12, 2007 their intention to form The PORTAL Alliance, an industry standard facility designed to serve the market for 144A equity securities.
The founding members of The PORTAL Alliance are Bank of America, Bear
Stearns, Citi, Credit Suisse, Deutsche Bank, Goldman Sachs, JPMorgan,
Lehman Brothers, Merrill Lynch, Morgan Stanley, NASDAQ, UBS and
Wachovia Securities. The collaboration is subject to the execution of a
definitive agreement and regulatory approvals.
The PORTAL Alliance will work with third-party service providers to
create an open, industry-standard facility for the private offering,
trading, shareholder tracking and settlement of unregistered equity
securities sold to qualified institutional buyers ("QIBs").
The PORTAL Alliance participants will contribute the expertise gained
in connection with the development of their existing 144A platforms to
create an industry standard facility with a uniform set of procedures
for issuers and QIBs to bring greater efficiency and transparency to
the 144A equity marketplace.
"We are excited to be working with this group of leading securities
firms to develop an industry-standard facility to enhance capital
formation and liquidity in 144A equity securities," said Bob Greifeld,
CEO of NASDAQ. "Investors and issuers will benefit from a unified
facility that includes trading, shareholder tracking, clearance and
settlement."
The matters described herein contain forward-looking statements that
are made under the Safe Harbor provisions of the Private Securities
Litigation Reform Act of 1995. These statements include, but are not
limited to, statements about the future benefits of the initiatives
described above. We caution that these statements are not guarantees of
future performance. Actual results may differ materially from those
expressed or implied in the forward-looking statements. Forward-looking
statements involve a number of risks, uncertainties or other factors
beyond NASDAQ's control. These factors include, but are not limited to
factors detailed in NASDAQ's annual report on Form 10-K, and periodic
reports filed with the U.S. Securities and Exchange Commission. We
undertake no obligation to release any revisions to any forward-looking
statements.
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Pro-Financial Asset Management Capitalizes on the Growth Opportunities of the Emerging Markets
Investors can now access these same growth opportunities with the
PRO FTSE RAFI Emerging Markets Fund
TORONTO - In response to the success of Pro-Financial Asset Management's Pro-Index Funds and the ongoing strength and growth of the economies of emerging markets like China, India, and Brazil, Pro-Financial Asset Management is pleased to announce the launch of the fifth Pro-Index Fund: the PRO FTSE RAFI Emerging Markets Fund.
Earlier this year, Pro-Financial Asset Management signed an exclusive
license and distribution agreement with the FTSE Group to launch a range of
innovative mutual funds for Canadian investors based on the award-winning and
rigorously tested FTSE Research Affiliates Fundamental Index (RAFI) Index
Series.
The Pro-Index Funds incorporate the best aspects of indexing - namely,
lower fees than actively managed mutual funds - while reducing volatility and
improving returns by allocating portfolio weightings based on a company's
fundamentals, not its stock price. The first four fundamental index mutual
funds were: the PRO FTSE RAFI Canadian Index Fund; the PRO FTSE RAFI US Index
Fund; PRO FTSE RAFI Global Index Fund, and the PRO FTSE RAFI Hong Kong China
Index Fund.
Fundamental index investing - the powerful engine that drives the
Pro-Index Funds - has already changed the index investing landscape in the
United States and is poised to do the same worldwide. Globally, this strategy
has earned respect and significant allocations from pension fund managers, and
has attracted more than $19 billion in total from institutional and individual
investors.
"When researching the most vibrant economies and markets around the
world, the same regions kept hitting our analysts' radar: the emerging
markets," said Stuart McKinnon, President & CEO of Pro-Financial Asset
Management.
"By simply diversifying 7% of an investment portfolio into emerging
markets, one would be able to access the fast-growing 50% of the global
economies based on the gross domestic product (GDP)"
The management team at Pro-Financial Asset Management believes the PRO
FTSE RAFI Emerging Markets Fund provides the perfect entry point to the
strongest companies in the emerging markets.
Mr. McKinnon also believes that the exclusive fundamental indexing
strategy incorporated in the investment process of the FTSE RAFI Index Series
lends itself perfectly to these types of high-growth regions.
Analysis of the series' performance based on total returns shows that the
FTSE RAFI Indexes demonstrate outperformance of market cap weighted
equivalents.
The FTSE RAFI Emerging Index has outperformed the MSCI EMF Gross by
459.32% over a 10-year period ending September 2007.
The FTSE RAFI Emerging Markets Index one-year return of 49.4%, three-year
return of 38.8%, five-year return of 34.7%, and 10-year return of 18.2% are
considerably higher than the returns of the Index's peers over the same
periods.
FTSE Americas President Jerry Moskowitz to visit Toronto to share
insights on this powerful new strategy
On November 14 and 15, 2007, Moskowitz will be in Toronto to discuss with
groups of and financial advisors the analysis work that goes into constructing
the fundamentally calculated FTSE RAFI Index Series.
With Moskowitz's visit, Canadians have the chance to learn directly from
a globally recognized leader how fundamental indexing can complement their
overall investment portfolio.
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White Paper Shows How to Build a Pension that Grows While it Pays off the Mortgage
TORONTO - To help Canadian investors recover thousands of dollars on bank interest and taxes, New World Financial is offering a free white paper. "Infinite Banking In Canada - How to Build a Pension that Grows While it Pays Off Your Mortgage" is a guide to a little known finance method that banks and large corporations use, but about which many individuals are not aware. Armed with this guide, most people can determine whether or not their retirement savings plans would improve with the use of infinite banking. The white paper's topics include: << - How to keep interest and fees you now pay to banks ... transforming it into tax free income for life - How to recover dollars you would have paid for cars, a home, equipment and investments - How Section 148 of the Tax Code defines the tax exempt status of Infinite Banking - How to shield retirement savings from stock and real estate market volatility - How to protect capital from creditors, lawsuits, probate, taxation, and tax clawbacks. >> The white paper also reveals how large companies such as TD Canada Trust and Bank of Montreal have invested hundreds of millions in Infinite Banking instruments in the USA, and that in Canada, consumers already own over half a billion in assets which they could use for this financial purpose.
The white paper
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TSX accepts Notice of Magna Intention to Make Normal Course Issuer Bid
AURORA, ON- Magna International Inc. announced that the Toronto Stock Exchange ("TSX") had
accepted its Notice of Intention to Make a Normal Course Issuer Bid (the
"Notice"). Pursuant to the Notice, we may purchase for cancellation and/or for
purposes of our long-term retention (restricted stock) and restricted stock
unit programs, up to 9,000,000 Magna Class A Subordinate Voting Shares (the
"Bid"), representing 9.9% of our public float. As of November 6, 2007, we had
117,860,222 issued and outstanding Class A Subordinate Voting Shares,
including a public float of 90,558,994 Class A Subordinate Voting Shares.
<<
As previously disclosed, the purpose of the Bid is:
- to attempt to offset any dilution arising from: (a) the issuance from
treasury on September 20, 2007 of 20 million of Class A Subordinate
Voting Shares pursuant to a statutory plan of arrangement involving
Magna and OJSC Russian Machines, to the extent such issuance was not
offset by the 11.9 million Magna Class A Subordinate Voting Shares we
purchased for cancellation pursuant to a substantial issuer bid which
was completed on September 25, 2007; and (b) the issuance from
treasury from time to time of Class A Subordinate Voting Shares on
exercise of Magna stock options; and
- to fund our restricted stock awards, the redemption of restricted
stock units and our deferred profit sharing plans.
>>
The Bid will commence on November 12, 2007 and will terminate no later
than November 11, 2008. All purchases of Class A Subordinate Voting Shares
will be made at the market price at the time of purchase in accordance with
the rules and policies of the TSX. Purchases may also be made on the New York
Stock Exchange ("NYSE") in compliance with Rule 10b-18 under the U.S.
Securities Exchange Act of 1934. Both the rules and policies of the TSX and
Rule 10b-18 contain restrictions on the number of shares that can be purchased
under the Bid, based on the average daily trading volumes of the Class A
Subordinate Voting Shares on the TSX and NYSE, respectively. As a result of
such restrictions, subject to certain exceptions for block purchases, the
maximum number of shares which can be purchased per day during the Bid on the
TSX is 91,737. Subject to certain exceptions for block purchases, the maximum
number of shares which can be purchased per day on the NYSE will be 25% of the
average daily trading volume for the four calendar weeks preceding the date of
purchase. Subject to regulatory requirements, the actual number of Class A
Subordinate Voting Shares and the timing of any purchases will be determined
by us having regard to future price movements and other factors.
The size of the Bid was adjusted from that disclosed on November 6, 2007
to account for shares in our Canadian and U.S, deferred profit sharing plans,
which are excluded from the public float.
We are the most diversified automotive supplier in the world. We design,
develop and manufacture automotive systems, assemblies, modules and
components, and engineer and assemble complete vehicles, primarily for sale to
original equipment manufacturers of cars and light trucks in North America,
Europe, Asia, South America and Africa. Our capabilities include the design,
engineering, testing and manufacture of automotive interior systems; seating
systems; closure systems; metal body and chassis systems; vision systems;
electronic systems; exterior systems; powertrain systems; roof systems; as
well as complete vehicle engineering and assembly.
We have approximately 83,000 employees in 240 manufacturing operations
and 62 product development and engineering centres in 23 countries. |
World Alternative Investment Summit Canada 2007
MONTREAL - Canadian Hedge Watch Inc. (CHW) and the Canadian Institute of Financial Planners (CIFPs) in conjunction with its strategic partner Dubai International Financial Centre are pleased to confirm the final line-up for World Alternative Investment Summit, Canada 2007 taking place at the Hilton Bonaventure hotel on November 5 - 7, 2007 in downtown Montreal.
The Alternative Investment event is in its sixth year and includes a
2?1/2 -day, 3 track agenda featuring hedge funds, private equity, exchange
traded funds, emerging global markets, flow through shares and more. In
addition the event features 18 fund companies within three Capital
Introduction Showcase sessions.
Speakers and panelists include Andrew Alford (Goldman Sachs), Doctor Ian
Bremmer (Eurasia Group), Pat Bolland (Business News Network), Leon Bitton
(Montreal Exchange), Jerry Davis (New Orleans Retirement System), Howard
Atkinson (Horizons Beta Pro), Cameron MacDonald (Goodwood), Louis Doyle
(Montreal TSX Venture Exchange), Rick Nathan (CanadianVenture Capital and
Private Equity Assoc.), Sandy Hershaw (Flow Through Association of Canada),
Grahame Lyons (Claymore Investments), Glen MacNeill (Sentry Select), John
Rekenthaler (Morningstar), Larry Berman (ETF Capital Management), John Lee
(Mau Capital) and many more.
The event has attracted leading industry participants from the US,
Europe, Asia and Canada itself.
Tony Sanfelice, President & CEO of CHW says "more and more traditional
investors and financial planners are coming to our event each year looking for
opportunities in the growing area of alternative investments". Mr. Sanfelice
estimates the growing global hedge fund market to be around $2 trillion
dollars in assets ($1.4 trillion according to HFR US as at Dec 31, 2006) and
estimates the global industry to reach $3 trillion to $4 trillion by 2010.
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CICA provides help to address exposure to liquidity crunch
TORONTO - Canada's CAs are providing support to help directors deal with the current asset-backed commercial paper (ABCP) liquidity crunch.
Canadian businesses and investors have become increasingly concerned
about their exposure to credit quality issues since problems with the U.S.
sub-prime mortgage market surfaced this summer. As companies consider
disclosure for quarterly and yearend reporting, management needs to provide
investors with a good understanding of how this situation is affecting their
companies.
Board and audit committee members need to ensure that appropriate
consideration has been given to the valuation of these investments and that
company disclosures relating to asset-backed commercial paper are clear,
complete and adequately describe any exposures or potential impacts. To
address these concerns, the CICA is recommending that directors focus on a
series of key questions when reviewing financial statements and to satisfy
themselves that management is effectively managing related company exposures
and risks.
"Our document walks directors through these questions to help them
understand what investors want to know and the level of information needed to
provide appropriate disclosure," said Dave Pollard, Vice-President of
Knowledge Development for the CICA. "Investors need this information to
understand and evaluate how exposures to ABCP could affect the company's
financial position, profitability and future prospects, and in order to make
informed investment decisions."
The CICA document is designed to provide guidance to directors in their
oversight roles. Further analysis and clarification on the financial reporting
of ABCP is expected to be released this week and posted on the Accounting
Standards Board web site.
ABCP is a secured short term debt obligation. Traditionally, the
underlying assets of the ABCP were principally made up of mortgages and
various types of consumer loans and receivables. However, many now hold a
significant portion of their assets in the form of credit default swaps,
collateralized debt obligations and other leveraged derivatives instruments.
Many of these instruments are complex and not widely understood.
"It is in the interest of businesses, investors and the reputation of
Canada's capital markets that all parties provide clear, accurate and complete
disclosures," said Pollard. "The CICA alert helps directors ask the right
questions to provide informed governance and oversight. This includes
addressing the impacts of the liquidity crunch on the debt and capital markets
and what it may mean for the financing strategies of the company."
The document, prepared by the CICA's Risk Management and Governance
Board, is the first in a series of alerts that will be developed as issues
emerge. It outlines questions for directors to ask, and for financial
executives to be prepared to answer and to consider in formulating their
corporate investment strategy. An important addition to the CICA's thought
leadership in financial reporting, governance and control, "The ABCP Liquidity
Crunch - questions directors should ask" is available on the Institute's web
site at www.cica.ca.
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Sun Life Financial reports Operating earnings per share of $1.01, up 9% over Q3 2006
TORONTO - Sun Life Financial Inc. announced operating earnings of $583 million. Fully diluted operating earnings per share (EPS)(1) of $1.01 increased 9% over the third quarter of 2006. The strengthening of the Canadian dollar relative to foreign currencies since the third quarter of 2006 reduced earnings by $19 million or $0.04 per share. Excluding the impact of currency, operating EPS would have increased by 13% over the same period last year. Operating return on equity (ROE) was 14.8% for the quarter.
"Strong sales and bottom line growth demonstrate Sun Life's continuing
business momentum across all of its markets and its consistent capacity to
deliver on commitments," said Donald A. Stewart, Chief Executive Officer. "Sun
Life's innovative products and services, combined with its broad distribution
capabilities, continue to fuel sales internationally, positioning the Company
to capitalize on key demographic opportunities."
"Our financial results this quarter reflect the diversity of our earnings
platform and our strong risk management capabilities," said Richard P.
McKenney, Chief Financial Officer. "Despite volatile economic conditions,
we're progressing steadily toward achieving our medium-term financial
objectives."
Operating earnings, operating EPS and operating ROE for the third quarter
of 2007 exclude after-tax charges to earnings of $5 million for re-branding
expenses in Canada and $1 million for the integration costs in SLF U.S.'s
Employee Benefits Group. Including these charges, EPS and ROE for the quarter
were $1.00 and 14.7%, respectively.
Business Highlights
During the third quarter of 2007, the Company progressed on a number of
its strategic objectives and continued to deliver on its growth and
distribution expansion strategies in each of its markets.
<<
- Individual segregated fund sales in Canada, including deposits from
the SunWise Elite Plus guaranteed minimum withdrawal benefit rider,
increased by 75% to $446 million in the third quarter of 2007 over
the same period last year.
- Sun Life Financial Canada's Group Retirement Services sales increased
22% over the third quarter of 2006 on several large sales, including
Magellan Aerospace at $110 million.
- Sun Life Financial Canada's Group Retirement Services retained
$192 million of assets from members leaving plans this quarter. This
represents an increase of 39% over the third quarter of 2006 and a
retention ratio of 34% for the first nine months of 2007. Sun Life
Financial Canada also announced the extension of its rollover program
to include Group Benefits plan members, offering individuals
transitioning from group benefits plans continued participation in
Sun Life products.
- Sun Life Financial launched its Canada-wide multimedia advertising
campaign in support of its brand strategy and the re-branding of its
career sales force. The Company's "Life's brighter under the sun"
advertising theme reinforces the important role Sun Life plays in the
lives of one in five Canadians.
- Sun Life Financial U.S. continued to build upon the success of its
Income ON Demand(SM) product and enhanced distribution capabilities
with gross domestic variable annuity sales of US$771 million, an
increase of 91% over the third quarter of 2006. Gross domestic
variable annuity sales for the first nine months of US$2.1 billion
have already exceeded full year 2006 sales by 23%.
- Sun Life Financial U.S. further diversified its Individual Life
product line, launching Sun Executive Variable Universal Life and Sun
Executive Universal Life, two new life insurance products designed
for small and mid-size business owners to fund non-qualified
executive benefit plans.
- Responding to the needs of institutional clients, MFS formed a new
subsidiary called Four Pillars Capital Inc. to provide support to
hedge fund managers. The new subsidiary will be run as a separate
entity, with MFS providing key operations, marketing and
distribution support.
- MFS's pre-tax operating profit margin ratio increased to 36% in the
third quarter of 2007 from 30% in the third quarter of 2006.
- MFS continued to achieve superior retail mutual fund performance with
80% of its U.S. mutual fund assets ranked in the top half of their
Lipper Category average over three years, as of September 30, 2007.
- In India, Birla Sun Life Insurance Company sales were up 177% in the
third quarter of 2007 compared to the third quarter of 2006. Birla
Sun Life now has operations in over 200 cities in India.
- In China, sales were up 162% in the third quarter of 2007 over the
same period last year. Sun Life Everbright (SLEB) was awarded two
significant group benefits plans during the quarter. SLEB will
provide group life and health benefits to the 13,000 employees of
China Everbright Group and Everbright Bank, and will provide claims
administration for the three million members of the Tianjin Bureau of
Labour and Social Security. Installation of the plans is expected to
take place in the fourth quarter of 2007.
- Sun Life Financial's CEO, Donald A. Stewart, has been selected as the
2007 International Executive of the Year by the Canadian Chamber of
Commerce and Canada's international business community. The award
recognizes business executives from a Canadian company whose
exemplary leadership has developed a strong, competitive presence for
Canada in global markets.
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Sun Life Financial declares quarterly dividend on Common and Preferred Shares
TORONTO - The Board of Directors of Sun Life Financial Inc.announced a quarterly shareholder dividend of $0.34 per common share, payable January 2, 2008 to shareholders of record at the close of business on November 21, 2007. This is the same amount as paid in the previous quarter.
The Board of Directors of Sun Life Financial Inc. also announced
quarterly dividends of $0.296875 per Class A Non-Cumulative Preferred Share
Series 1; $0.30 per Class A Non-Cumulative Preferred Share Series 2; $0.278125
per Class A Non-Cumulative Preferred Share Series 3; $0.278125 per Class A
Non-Cumulative Preferred Share Series 4; and $0.28125 per Class A
Non-Cumulative Preferred Share Series 5, payable December 31, 2007 to
shareholders of record at the close of business on November 21, 2007.
Sun Life Financial Inc. has designated the dividends referred to above as
eligible dividends for the purposes of the Income Tax Act (Canada).
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Canadian Business Lacks Adequate Risk Management in Emerging Markets, Ernst & Young Study Reveals
TORONTO - Business investment in emerging markets continues to boom, but many Canadian companies are failing to manage risk effectively according to a global survey by professional services provider Ernst & Young.
"It is surprising to have 60 percent of Canadian companies with no
emerging market risk management strategy in place," explained Carol Willson,
Executive Director, Risk Advisory Services, Ernst & Young. "Canadian companies
investing in emerging markets, such as China, Brazil and India, need to focus
on risk exposure or they will miss business opportunities."
According to the study, only 46 percent of Canadian companies admit their
board of directors are involved in managing risk in emerging market ventures.
That's compared to 53% of global respondents who participated in the survey.
"A clear risk management strategy driven by corporate leadership will
help the business manage risk and allocate resources more effectively and
improve the quality of controls, processes and communications," Willson said.
"Canadian companies must develop and implement overarching risk management
strategies for their entire organization, starting with leadership."
For Risk Management in Emerging Markets, Ernst & Young interviewed more
than 900 senior executives responsible for risk management in either
international headquarters or emerging market operations. The survey shows
developed market companies are more likely to worry about political risks (40
percent), whereas emerging market businesses focus on more immediate risks
such as market and competitive risk (41 percent), and currency (28 percent).
However, this risk concern does not translate into consistent risk
management strategies. Over half (56 percent) of developed market companies
say they have no strategy in place to manage risk in emerging markets.
Surprisingly, North American companies are the least likely to have a strategy
in place to manage risk in emerging markets (only 25 percent have a strategy
compared to 46 percent in Europe and 52 percent in the Far East).
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Fundamental index investing gains momentum in Canada
FTSE Americas President Jerry Moskowitz to visit Toronto to share
insights on this powerful new strategy
TORONTO - In just two years, fundamental index investing has attracted more than $19 billion globally. Jerry Moskowitz, president of FTSE Americas, believes this is not a short-term phenomenon. Rather, it is part of a longer-term trend towards index calculation with the potential to provide higher risk-adjusted returns and lower portfolio volatility.
"Fundamental indexes are changing the investment landscape around the
world," Moskowitz says from his New York office. "A traditional index ranks
companies based on market value, but a fundamental index is built based on
objective measures of a company; it strives to measure the economic footprint
of a business by examining its basic strengths - sales, dividends, cash flow
and book value. That can give fundamental indexes a significant advantage
during market downturns."
On November 14 and 15, 2007, Moskowitz will be in Toronto to discuss with
groups of investors and financial advisors the analysis work that goes into
constructing the fundamentally calculated FTSE RAFI Index Series. Alongside
him will be Stuart McKinnon, president and CEO of Oakville, Ontario-based
Pro-Financial Asset Management, which has an exclusive distribution agreement
with the FTSE Group for the Canadian distribution of mutual funds linked to
the FTSE RAFI Index Series.
"The FTSE RAFI index approach provides significant alpha over the
cap-weighted indexes across the global markets" says McKinnon. "We've analyzed
historical performance in markets as diverse as the United States, Canada,
Hong Kong, Ireland, Norway and Singapore. In virtually every case, FTSE RAFI
indexes beat traditional cap-weighted indexes. We were impressed by the
remarkable consistency of this strategy and wanted to make it easily available
to Canadian investors within a familiar mutual fund structure."
With Moskowitz's visit, Canadians have the chance to learn directly from
a globally recognized leader how fundamental indexing can complement their
overall investment portfolio.
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NASDAQ Introduces the Q-50 Index
New Index Comprised of the Next 50 Securities Eligible for
the NASDAQ-100 Index
NEW YORK - The Nasdaq Stock Market, Inc. announced the introduction of the NASDAQ Q-50 Index(sm), an innovative tool to track the securities that are next eligible for inclusion in the world-renowned NASDAQ-100 Index(r). NASDAQ began disseminating the NASDAQ Q-50 Index October 10, 2007.
The Index is comprised of 50 non-financial securities ranked by market
capitalization. They reflect companies across major industry groups
including computer hardware and software, telecommunications,
retail/wholesale trade, and biotechnology.
"The NASDAQ Q-50 Index is a new benchmark for some of the world's most
up-and-coming growth companies," said NASDAQ Senior Vice President
Steven Bloom. "The Index arms investors with a portfolio of some of
NASDAQ's fastest growing companies in a diverse range of industries.
The launch of the NASDAQ Q-50 Index represents a significant extension
of NASDAQ's success in bringing attention to its largest and most
liquid innovative growth companies."
Securities in the NASDAQ Q-50 Index are next eligible for inclusion in
the NASDAQ-100 Index, a globally recognized benchmark that is the basis
of more than 500 investment products in 36 countries. The NASDAQ Q-50
Index is a price return index (Nasdaq:NXTQ), which is ordinarily
calculated without regard to cash dividends on index securities. The
Index commenced calculation today with a value of 150.00.
NASDAQ Financial Products (NFP) is engaged in the design, development,
calculation, licensing, and marketing of NASDAQ indexes. NFP
specializes in the development of indexes focusing on NASDAQ's brand
themes of innovation, technology, growth, and globalization. NFP also
provides custom index services and design solutions as a third-party
provider to selected financial organizations. For more information
about NASDAQ's indexes, visit www.nasdaq.com/indexes.
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