Part 2: The Merchant Loyalty Industrial Complex Collapse
Since November 2, 2021, Loyalty Ventures Inc.'s (Airmiles) market cap has decreased from $861.42M to $2.11M, a decrease of -99.75%. This compares closely to 2018, when Aimia sold Aeroplan back to Air Canada and partners TD and CIBC for $238 million. For reference, in 2005 Aeroplan launched an IPO valuing it at $2 billion. Related to Aimia’s downfall, it had also previously sold the UK Nectar program to Sainsburys for $120 million, $580 million lower than it paid for Nectar in 2007.
This report digs under the surface and uncovers why loyalty is going the way of the dodo.
Merchants should not waste time fighting card networks
This is part one of a two part assessment of merchant frustration due to high credit card fees. The second part of this report will outline an alternative approach that merchants can consider. An approach that is a win for them and also for the card networks.
The full story of SVB March 12th, 2023
Aggregated news and research related to SVB. Apart from SVB, included in this report is related news with respect to other banks and non-traditional companies looking to add financial services that also appear risky.
March 2023 bank earnings summary
This report provides a snapshot into recent bank earnings and related news as published in fsim.ca reports.
Real estate report: October 30th, 2020
The big buzz in real estate recently is Mark Carney being scooped up by Brookfield. This means more juice for riskier borrowers. Brookfield, a huge player in real estate, both residential and commercial, recently bought its remaining shares from Sagen (Genworth MI Canada), which values the company at $3.8 bn.
VersaBank’s New High-Security VPN Proving Especially Valuable During COVID-19 Pandemic
VersaBank (TSX:VB) (“VB” or the “Bank”) today announced the implementation of its new high security Virtual Private Network (VPN) remote access software solution, developed in partnership with Tailscale, a leading provider of secure network connectivity solutions. The software enables VersaBank employees to securely and directly connect to all the Bank’s servers across multiple offices and cloud providers, using two factor authentication and with every connection encrypted. The Tailscale-based solution uses the Office 365 setup and Windows client/server applications that the Bank already had in place.
2014 FSIM when Bernanke visited Montreal
Considering Bernanke is hated by the Republicans and hated even more by the Democrats, and is currently under scrutiny for saving AIG but not Lehman, (in hindsight) with respect to issues over solvency vs liquidity, the Montreal lovefest attended by 1,100 people yesterday must have been a welcome respite. Click the link to read the entire 2014 report.
Eisman's big Canadian bank short
I have been reporting on Steve Eisman's short position for quite some time. As the analyst reaction to Eisman shows (link below), Eisman has taken a lot of heat for shorting Canadian banks. Instead of capitulating, in September 2019 he publicly disclosed the fact that he added Canadian Tire to his position, He explains the rationale for this in a BNN interview late 2019. Essentially, his big concern with respect to banks was non-performing loans in Alberta. He feels Canadian bank CEOs are not prepared for a credit cycle. He specifically referenced ATB (a private bank) in discussing his concerns. Looking at the numbers today, my guess is that he has made off like a bandit.
VersaBank Beta-Testing Its New, High Volume Mortgage Finance App
VersaBank announces it is initiating beta-testing on its newly developed high-volume mortgage software app with the Cortel Group, one of Canada’s largest home and condominium builders. The app, named “Direct Connect”, was designed to facilitate and significantly reduce the lengthy finance approval process typically experienced by home buyers when visiting home and condo pre-construction sales offices.
How and why you need to defend your brand against disruptors
Technology, and being open to opportunities, has preempted transformation in banking. At the top of change are Mint, PayPal and ApplePay; three examples of transformative solutions that are now ubiquitous. On the horizon: Uber and Google, both having recently announced partner based banking services. Further down in the plumbing is Duca Impact Labs, Versabank, and Revolut. This report shows how cost conscious FIs can, not only stay relevant in the face of adversity, but punch well above their weight. All thanks to creative thinking and the ongoing commoditization of technology.
Kick the can(nomics)
Canada has used consumer debt to provide life support to the economy. This strategy which basically pushed the day of reckoning to the next government was old back in 2014, and now is well past its sell-by-date. Recognizing this, and desperate to keep the economy out of a recession, Trudeau is spending more money now than any government in Canadian history. This report disusses a possible alternative.
ScoreCard Bill Morneau, Canada's Minister of Finance
This report is a scorecard I designed in order to rank the performance of the current Minister of Finance, Bill Morneau. I do regular rankings because, otherwise, I cannot measure the performance in a meaningful way. The scoring is based on a variety of metrics as detailed on the ‘score-table’ on page 3. Examples of the criteria and weighting include:
Observations and overview of 2018 NB flood support from government and insurance companies.
Flood aftermath is linked to post traumatic stress. Here are some findings from a study conducted by Queensland University following a flood:
"The findings showed that aftermath stress contributed to poor mental health outcomes over and above the flood itself, prior mental health issues and demographic factors," Ms Dixon said.
"Aftermath stress was the strongest predictor of post-traumatic stress symptoms with 75 per cent of people saying the most difficult aspect was the aftermath and dealing with insurance companies," she said.
With this in mind, I felt it was important to understand how New Brunswick flood victims were treated.
Update Argentina: a sign of the times
Argentina is in the news daily because the situation is dire, and may be an indication of further contagion. The most dramatic story that speaks of the a leading cause of its troubles was the recent arrest of the public works secretary, Jose Lopez. June 15th he was caught hiding millions in cash in a monastery. No this is not a plot for a comedy.
Summary of Canada's flood news, 2017 to present
This report covers flood news in Canada from 2017 to present and highlights the relevent issues for home-owners and the insurance industry.
Banking on Pot
As states across the US legalize marijuana for both medicinal and recreational purposes, it has fueled a growing industry of marijuana related businesses (MRBs).
2014 Mobile payments the Apple pay way
With Walmart Pay about to userp Apple Pay, I thought I would share my 2014 book on mobile payments and loyalty. The guilde was written for Merchants that want to understand loyalty, credit, mobile payments and Apple Pay, but anyone involved with credit and loyalty might find it useful.
The book is a prelude to Walmart leaving MCX, and chronicles the evolution that led to Walmart Pay. There is an extensive case study of Walmart that looks into its efforts to become an ILC and to avoid paying credit card transaction fees ('merchant discount').
It offers readers a step-by-step methodology for evaluating and transforming credit and loyalty programs. The strategies are based on proven examples and industry facts. The Nectar, Target, Canadian Tire and Walmart case studies are examples of the practical approach I have taken, written with the intent that merchants can use them as blueprints for their own initiatives.
Death to bitcoin, long live the blockchain (See full report)
Jamie Dimon calls bitcoin a fraud used by criminals, yet he has jumped into the blockchain with both feet.
TD bank industry conduct
TD’s share price recently collapsed by $7 bn in one day due to CBC’s allegations of aggressive selling tactics. A huge fall from a bank that was trading at a premium as recently as January. This was even before the most recent allegation of TD attempting to avoid paying taxes on advertising.
This report chronicles the events leading up to the collapse, shows TD's performance, analyses other related issues.
Book review: Back from the Brink
This is a book review of the book Back from the Brink by Paul Halpern, Caroline Cakebread, Christopher C. Nicholls and Poonam Puri.
Footnote 151 implies an important regulatory change related to derivative contracts. It means that US Banks will not be required to hold as much capital against commodities. If you want to understand the implications of this regulatory change in more detail, see the enclosed related article detailing the changes. For contextual purposes, I have also included two Rolling Stones Magazines reports from 2010 and 2014 that chronicle the role large US banks have played in manipulating commodities. You might question the credibility of these sources, but rest assured, these reports are based on United States Senate hearings which outline the issues in a 396 page report related to the implied risks.
Save the Canadian economy now
Consumer debt spending appears to have insulated Canada from the worst of the credit crisis, but now the alarming magnitude of consumer debt ($1.92-trillion) could exacerbate a day of reckoning.
This report assesses the issues at hand and recommends the solution to get Canada's economy on track.
Reasons financial service companies should consider gamification
Gamification of business processes resulted on Mint.com growing to 10 million users within 4 years. This report explains how.
National Bank Special Report
According to Bloomberg, National Bank of Canada will take a C$64 million ($48 million) restructuring charge in the fourth quarter and said its investment in Maple Financial Group Inc., which is being probed by German regulators, may be at risk of a “substantial loss.”
Will Canadian banks charge companies for deposits?
In light of today’s possible rate cut, this report discusses how a bank rate cut and capital ratio pressure could precipitate negative corporate deposit interest rates in Canada.
Canadian Tire's (CTC) - Canadian Tire Financial Services (CTFS) Scotia deal overview and risk assess
Review of the Canadian Tire Financial Services deal with Scotiabank, risks, opportunity and benefits.
Finance minisiter scorecard August 26, 2015
This report looks at Joe Oliver, minister of finance’s progress to date, and assigns a grade to his government’s performance to date.
Branches are evolving to meet the digital age. This documents tracks the evolution with real-world examples.
Whether he knew it or not, Tom Reid, a senior vice-president at Sun Life, made a case for the behavior modification concept ‘Nudging’ when he recently proposed auto-enrolling Canadians in his company’s pension plans. Sun life cover 1.2 million Canadians, about 60% of the eligible employees.
According to Reid,
CWB cause for concern
In an earlier report BankNews.TV expressed concerns about CWB. Here are 5 charts that show cause:
1. First earnings drop in years;
2. Deposits dropping which will increase cost of funds in the future.
BankNews.TV Publishing Corp services overview document:
Financial services industry monitor (FSIM) industry briefings and developments reports
Challenger banks not a threat to big banks
This report looks at Canadian challenger banks (apart from merchant led banks) and explains why they have not threatened larger institutions. It also looks at ways in which these upstarts have achieved success.
Gamification of financial data project
This document contains details on how BankNews.TV is helping kids learn programming via gamification of financial data.
The impact a rate rise will have for Canadian banks
Canadian banks have made money throughout the credit crisis, but this trend may be about to reverse. The rational supporting this prediction is that revenue has grown despite a declining net interest margin (NIM). It has grown in spite of this fact because Canadian debt (loan lease volume) has risen significantly, as shown in chart 2.
This report looks at the issues facing Canadian banks in the event of a Bank Rate rise.
FIFA: the new goldenballs
Yesterday, the Attorney General of Switzerland (OAG) opened criminal proceedings related to the FIFA scandal. This report outlines some of the events related to the criminal investigation, with a particular focus on banking.
Scorecard Minister of Finance: JIm Flaherty
March 18, Finance Minister Jim Flaherty resigned from cabinet after having endured a difficult year due to health issues. This report looks at his legacy and attempts to grade his government’s performance to date.
Sample RFP for a Loyalty Program
Merchants extend financial services
Merchant led financial services are growing in importance once again. This is exemplified in the ongoing UK rivalry between ASDA, Sainsbury and Tesco. Together these merchant/financial service companies provide the backstop for three different approaches for merchants looking to extend their financial services.
Hot Money: real-estate
Canadian and London real estate, like Macau, may also be a convenient means for China’s elite to move money offshore; with the deleterious effect of driving up home values. Louise Shelley`s research concurs. In a published paper written for the National Defense University, Shelley argues that money laundering in real estate (MLRE) increases prices.
Currency Cheat Sheet: a guide for the rest of us
Readers of this document will be presented with monetary policy issues and facts
that show the USD will likely remain the dominant reserve currency, despite
questionable Chinese practices, record US debt levels, and a shaky economy.
Riches to Rags? Summary of possible risks for Genworth MI CANADA, INC.
Genworth had its Q4 2014 earnings call. Genworth own about 30% of the mortgage default insurance in Canada. Not surprisingly, the earnings call became focussed on Alberta; and for good reason, with 20% of its outstanding insured mortgage balance in Alberta, sensitivity to the oil shock and how Genworth plan to manage related risks were discussed in detail.
Canadian Western Bank Competitive Forecast
Based on historical financial data (see detailed charts pages 5-8), the oil based recession in Alberta, and comparison against two of its peers, this document outlines my observation with respect to CWB’s future performances.
Liquid Canada: the tipping point
This report examines liquidity issues in the Canadian financial service industry.
Recently the CBC and The Globe and Mail both reported on what has been referred to as a consumer “bank fee outcry”. CBC compares banks to cable and phone companies, standing accused of trying to gouge customers with service fees. The backlash appears to have originated in conjunction with the NDP and the Consumers Council of Canada which argues that there is anxiety ‘among consumers about banking fees’.
Cheap Oil Report
Cheap oil has pushed the Bank of Canada's governor, Stephen Poloz onto a slippery slope. For some background on this, take October 22nd, when Poloz bid farewell to forward guidance, resulting in yesterday's surprise rate cut. A cut that has enraged TD and other banks, which see this as eroding profits.
Canada's Economy, a strategic solution
This report explores Canada's strategies to compete globally. The report begins with an analyses of the housing market, because housing is the canary in the coal mine; explores what happens in the event of collapse; and analyses the underlying problem causing Canada to be uncompetitive.
Mobile Payments Blueprint: guide to credit and loyalty transformation for merchants
Merchants that want to understand loyalty, credit and mobile payments should read this book. It offers readers a step-by-step methodology for evaluating and transforming credit and loyalty programs. The strategies are based on proven examples and facts. The Nectar, Target, Canadian Tire and Walmart case studies are examples of the practical approach I have taken, written with the intent that merchants can use them as blueprints for their own initiatives.
Guide to system selection
Read sample report: Guide to system selection. This sample would normally cost $99 but is available free as a sample.Â Click here view sample report.
Operating in a ring-fenced environment and involving a digital currency that is a real claim on the Reserve Bank, 14 pilot projects with a range of industry participants investigated potential CBDC use cases.
G&M - David Rosenberg (2023-12-06)
There may be lies, damned lies, and statistics as Mark Twain posited. But statistics, as flawed as they may be, are all we have to go by. And the statistics show a Canadian economy that very likely has already slipped into a recession, even as Tiff Macklem doth protest too much.
Consumer debt and credit delinquencies are on the rise as high interest rates, skyrocketing housing costs and inflation take a toll on Canadian borrowers, according to a third-quarter report from credit-rating agency Equifax Canada. Credit counsellors say they expect those effects will worsen in coming months and years.\nRebecca Oakes, vice-president of advanced analytics at the firm, said credit card debt rose significantly and drove increases in overall debt in the third quarter of 2023, a concerning trend that leaves Canadians vulnerable to high interest rates.
The federal agency responsible for combatting money laundering and terrorist financing imposed its largest-ever fine Tuesday against RBC.
G&M - Shane Dingman, Rachelle Younglai (2023-12-06)
Westbank Corp., a prominent Canadian developer known for its ambitious architecture, is facing problems at several projects in Toronto and Seattle with contractors claiming millions of dollars in unpaid bills.
Yahoo Finance - Gigi Suhanic (2023-12-06)
“We expect the Bank of Canada (BoC) to remain on hold with the overnight rate at five per cent. The economy remains weak as shown by the GDP contraction in 3Q (-1.2 per quarter-over-quarter seasonally adjusted annual rate) and the output gap is closing.
Yahoo Finance - Pete Schroeder and Nupur Anand (2023-12-06)
Supervisors are targeting small, mid-size and larger banks, the people said. Reuters could not ascertain exactly how many banks overall were targeted, but eight of the sources said they each had knowledge of multiple cases or banks affected.
Yahoo Finance (2023-12-06)
The 27-nation bloc’s Artificial Intelligence Act has been hailed as a pioneering rulebook. But with time running out, it's uncertain if the EU's three branches of government can thrash out a deal Wednesday in what officials hope is a final round of talks.
FP - Pamela Heaven (2023-12-06)
The concern is if higher interest rates further dampen demand the ratio will slip to levels not seen since the deep housing market downturn in the late 1980s to mid-1990s, said TD economist Rishi Sondhi.
Sales-to-new-listings ratios measure supply and demand in housing markets and help predict prices. A ratio under 40 per cent means a buyer’s market where new listings exceed sales, between 40 and 60 per cent is a balanced market and over 60 per cent, where demand outstrips supply, is a seller’s market.
During the late 1980s and early 1990s, home prices plunged by 32 per cent across Ontario, falling 38 per cent in the Greater Toronto area.
The economic backdrop is also better. From March 1990 to May 1992, Canada was in a deep recession, brought on by high interest rates and fiscal belt-tightening, among other forces. Ontario GDP and employment dropped 6 per cent peak to trough.
Better Dwelling (2023-12-06)
Greater Toronto real estate prices continue to fall, now wiping out any gains made over the past year. The TRREB benchmark price shed $22.3k to hit $1.08 million in November. The City of Toronto benchmark fell $19k to $1.06 million. Both measures are virtually unchanged from last year, with the brief period of gains made earlier this year now totally wiped out.
According to the AGCM, messages about the move were sent to customers in the archive section of the Intesa Sanpaolo App without any push notifications or pop-ups.
MPs have also urged the Government to alleviate privacy concerns around the misuse of personal data through robust regulation and legislated protections.
G&M - RACHELLE YOUNGLAI (2023-12-05)
Toronto home sales rose in November after five months of declines, but property prices fell further as competition waned among buyers.
In addition to servicing the existing mortgages, Nesto will also be responsible for the Canada Life mortgages at maturity.\nThe partnership follows Canada Life’s 2022 decision to withdraw from the residential mortgage market.
Payment technology company Nuvei Corp. has signed a partnership agreement with Microsoft Corp. Financial terms were not immediately available.\nUnder the deal, Microsoft will start using Nuvei’s payments technology in the Middle East and Africa.
Swiss private bank Banque Pictet has admitted to helping U.S. taxpayers hide more than $5.6 billion from the Internal Revenue Service (IRS) and has entered into a deferred prosecution agreement with the Justice Department, federal prosecutors said on Monday.
And as banks set aside hundreds of millions more in reserves for bad loans, are there risks to Canada’s economy and financial institutions? Ron Butler, mortgage broker at Butler Mortgage and host of the Angry Mortgage Podcast, explains.
CBC - Madeleine Cummings (2023-12-05)
"If you were not the one who input your bank card number, secret online banking password and the one-time passcode, then either you somehow disclosed this information, or one of your devices (computer, cellphone) may have been compromised to allow someone to gain access to this information," wrote senior investigator Gary Jasper.
Yahoo Finance - Jeff Lagerquist (2023-12-05)
The national cleantech lead at RBCx, Royal Bank’s (RY.TO)(RY) in-house shop for providing banking services and capital to tech companies, joined a panel discussion last week to discuss corporate participation in Canada’s innovation ecosystem.
Yahoo Finance - Koh Gui Qing (2023-12-05)
The extent to which FHLBs finance insurers has not been previously reported. Reuters interviews with more than a dozen industry executives and regulators, a review of regulatory disclosures and data show this borrowing has not been matched by a rise in home loan affordability, with the cost of mortgages soaring to its highest in 23 years.
Yahoo Finance (2023-12-05)
The credit rating firm said it expects China’s economy to grow at a 4% annual pace in 2024 and 2025, slowing to an average of 3.8% for the rest of the decade.
FP - Mathieu Dion (2023-12-05)
FP - Pamela Heaven (2023-12-05)
Reuters - Francesco Guerrera (2023-12-05)
Words are fighting it out with numbers in financial markets at present. Comments by central bankers underline their desire to keep interest rates high until price growth quiesces. Traders, however, are paying closer attention to falling inflation figures, sending bonds higher in the expectation of lower borrowing costs. Policymakers’ recent mistakes mean they will struggle to convince investors their tough talk is real.
Bloomberg - Sunil Jagtiani and Suvashree Ghosh (2023-12-05)
The stock market had a rough Monday following several weeks of strength. It was a similar story in the bond market. And gold did a U-turn after climbing to a new record above $2,100 an ounce.
Investment Executive - Ritika Dubey (2023-12-05)
The Desjardins report, using data from analytics firm AirDNA, said Canada has more than 235,800 unique active short-term rental listings on Airbnb and Vrbo, the two largest hosting platforms, amounting to about 1.4% of the country’s housing stock.
The Bank of Canada is expected to cap another tumultuous year for monetary policy with a stand-pat decision this week that keeps interest rates steady while offering few hints about what comes next.
If you’ve loaded up on GICs over the past 18 months, I understand. I’ve bought a couple myself. The thought of a 5-per-cent yield is intoxicating after years in which payouts were often half that.
Yahoo Finance - Pamela Heaven (2023-12-04)
Investors are now fully pricing in a 25 bps rate cut by April, a 75 per cent chance by March and even a 20 per cent chance by next week.
Yahoo Finance - Alastair Marsh and Greg Ritchie (2023-12-04)
Banks also differ in how they account for investments, with some counting new inflows and others tallying assets under management.
Yahoo Finance - Pete Schroeder (2023-12-04)
The top bosses of JPMorgan, Bank of America, Citigroup, Wells Fargo and other major banks are expected to warn lawmakers this week that capital hikes and other new regulations will hurt the economy and should be indefinitely shelved.
Swiss bank UBS (UBSG.S) plans to expand its presence in the U.S. market as part of its strategy to hit $150 billion in net new money, or inflow of new funds, per year, an executive told Swiss newspaper NZZ Am Sonntag in an interview published on Sunday.
Bloomberg - Mark Gurman (2023-12-04)
Apple and Goldman Sachs are on the verge of splitting up, and Chase is the ideal partner to step in. Also: Sonos gets ready to take on Apple and others in headphones and TV set-top boxes; Apple continues eyeing 6G; and new retail stores are coming.
Bloomberg - Irina Anghel (2023-12-04)
Consulting giants and law firms are looking to artificial intelligence to speed up the time it takes junior staffers to make it to the prestigious partner level as the technology eliminates vast swaths of the repetitive, time-consuming tasks that typically filled up their first few years on the job.
Bloomberg - Takashi Nakamichi and Nao Sano (2023-12-04)
Several Japanese investors sued the brokerage arms of SBI Holdings Inc., Rakuten Group Inc. and Monex Group Inc., adding to the fallout in the world’s third biggest economy over losses on Credit Suisse’s riskiest debt.
Forbes - Brai Odion-Esene (2023-12-04)
Today, the average APR for the benchmark 30-year fixed mortgage fell to 7.52% from 7.57% yesterday. One week ago, the 30-year fixed APR was 7.69%. Meanwhile, the average APR on a 15-year fixed mortgage sits at 6.71%. At this same time last week, the 15-year fixed-rate mortgage APR was at 6.97%. And the average APR on the 30-year fixed-rate jumbo mortgage is 7.57%. Last week, it sat at 7.72%
The Ontario government is moving quickly to get more money into major projects by appointing former Bank of Nova Scotia\nchief executive officer Brian Porter as the inaugural chair of the newly created Ontario Infrastructure Bank.
G&M - Stefanie Marotta (2023-12-01)
Canadian banks are slashing jobs to curb mounting expenses and taking higher loan loss provisions as they grapple with the threat of an economic slowdown
Royal Bank of Canada, Toronto-Dominion Bank and Canadian Imperial Bank of Commerce reported on Thursday while Bank of Montreal, National Bank of Canada will release their fourth-quarter results on Friday.
G&M - Matt Lundy (2023-12-01)
The Canadian economy tumbled over the summer as export shipments waned and consumer spending flattened, signs of a continuing malaise as the country grapples with higher interest rates – and a sharp contrast with robust growth in the United States
Trudeau reports $150-billion in new spending on retirees between now and 2028, with many billions more to follow.
CBC - Pete Evans (2023-12-01)
"Whatever label you slap on this economy, it's basically not growing, despite the artificial sweetener of rapid population growth," he said. "The big picture is that the Canadian economy is struggling to grow, yet managing to just keep its head above recession waters."
Yahoo Finance - Pamela Heaven (2023-12-01)
Investors are now fully pricing in a 25 bps rate cut by April, a 75 per cent chance by March and even a 20 per cent chance by next week.
Yahoo Finance - Eliza Ronalds-Hannon and Erin Hudson (2023-12-01)
The so-called ad-hoc group of bondholders, which has said it holds more than $6 billion of the builder’s about $19 billion of offshore notes, has held a key role in Evergrande’s restructuring talks.
On Friday, Caixabank, the country's biggest lender by domestic assets, said the supervisor had set a minimum threshold of 8.58% for its strictest measure of solvency, or Common Equity Tier 1 (CET1), for 2024 compared to 8.44% set a year ago by the ECB.
Investment Executive - Ian Bickis (2023-12-01)
“Everybody understands that HSBC is leaving, has made a choice to leave, and it would look horrible on Canada if you didn’t allow the free flow of capital.”
In 2020, the company abandoned a planned UK launch as it dealt with operational problems caused by an explosion of day trading in its core US market during the Covid-19 pandemic. A renewed push was signalled in July when it tapped Freetrade executive Jordan Sinclair to lead the business in the UK.
Canadian businesses rejected by banks are increasingly turning to private lenders for financing, as demand for capital outstrips supply in the traditional debt market.
G&M - Rob Carrick (2023-11-30)
Canadians heading into retirement are in a great position, said no one ever. But even by this usual standard of negativity, a new report on retirement by Deloitte Canada is a stunner.
Canada’s securities regulators want to design a binding dispute resolution process that would require investment firms to pay monetary fines if it is determined they committed wrongdoing against retail investors.
Bank of Canada Governor Tiff Macklem keeps telling us that Canada hasn’t fallen into a true recession.
G&M - Bill Curry (2023-11-30)
The DST would be a 3-per-cent tax on certain revenue earned by large businesses from certain digital services. It is primarily aimed at large digital service providers such as Amazon, Google, Netflix and Spotify.
The shareholders are restless. During the 2023 proxy season, Canadian companies found themselves in the crosshairs of a record-breaking 69 shareholder activist campaigns, according to Kingsdale Advisors, a Toronto-based consulting company that for two decades has advised public companies on governance, transactions and shareholder relations.
Canada is fighting financial crime in fits and starts. The federal government conveyed this week that money laundering, terrorist financing and evasion of sanctions are “real threats” that harm the “integrity of our financial system and have real costs for the Canadian economy.”
Canadian Imperial Bank of Commerce reported a jump in fourth-quarter profit on Thursday, as a strong performance from its capital markets unit helped offset the hit from bigger provisions. The bank reported adjusted net income of $1.52 billion, or $1.57 per share, for the three months ended Oct. 31, compared with $1.31 billion, or $1.39 per share, a year earlier
Yahoo Finance - Barbara Shecter (2023-11-30)
An independent evaluation in 2022 led by York University law professor Poonam Puri concluded that the current structure where OBSI’s only power is to “name and shame” investment dealers that don’t abide by its rulings “provides an economic incentive for both parties to settle for amounts below OBSI’s recommendation.”
Yahoo Finance (2023-11-30)
A decline in real GDP would mark the second consecutive quarterly contraction, meeting the definition of a technical recession.
FP - ShantaÃ© Campbell (2023-11-30)
FP - Nojoud Al Mallees (2023-11-30)
Bloomberg - Christine Dobby (2023-11-30)
Canadian Imperial Bank of Commerce topped analysts’ earnings estimates as the lender reported loan-loss provisions that came in below forecasts.
Bloomberg - Randy Thanthong-Knight and Derek Decloet (2023-11-30)
Canadian house prices that remain elevated due to record population growth — but despite restrictive monetary policy — complicate the Bank of Canada’s inflation fight, a top economist said.
CBC - Pete Evans (2023-11-29)
The bank's expenses rose to $5.5 billion during the quarter, an increase of 22 per cent. The bank attributed its surging costs to "higher personnel costs, technology-related costs, performance-based compensation, business and capital taxes, share-based compensation, advertising and the unfavourable impact of foreign currency translation."
Yahoo Finance - Tommy Wilkes (2023-11-29)
Some of the banks, which also include Societe Generale SA and ABN Amro Bank NV, have also raised concerns that SBTi's greenhouse gas emissions target-setting demands are too hard to meet, the sources added.
Yahoo Finance - Garfield Reynolds (2023-11-29)
A Bloomberg gauge of global sovereign and corporate debt has returned 4.9% in November, heading for the biggest monthly gain since it surged 6.2% in the depths of the recession in December 2008.
The tech giant recently sent a proposal to the Wall Street bank to exit the contract in the next 12 to 15 months, the report said, citing people briefed on the matter. Apple and Goldman had started to roll out a virtual credit card in 2019.
Bloomberg - Amanda Cantrell (2023-11-29)
Billionaire investor Bill Ackman is betting the Federal Reserve will begin cutting interest rates sooner than markets are predicting.
The Pershing Square Capital Management founder said such a move could happen as soon as the first quarter. Traders are fully pricing in a rate cut in June, with the chance of a cut happening in May priced at about 80%, according to swaps market data.
Bloomberg - Robert Tuttle (2023-11-29)
Alberta Premier Danielle Smith invoked a measure to defy federal regulations that aim for a net zero electrical grid by 2035, setting up a confrontation between the Canadian province and Prime Minister Justin Trudeau’s government.
The resolution proposed under the Alberta Sovereignty Within a United Canada Act orders provincial government agencies to not enforce or aid in enforcing Canada’s clean electricity regulations, arguing that power generation is the jurisdiction of the provinces under the constitution, not the
FT - Roula Khalaf (2023-11-29)
Storm clouds are forming. Profits at the Big Six — which include Scotiabank, Toronto-Dominion Bank and Bank of Montreal — are expected to shrink this year as bad debt provisions rise and loan growth slows. Scotiabank kicked off Canadian banks’ earnings season on Tuesday.
NatWest research identified the most prevalent scams which all feature in the game. The most popular being phishing, vishing and smishing scams, impersonation scams, and refund scams.
Thousands of HSBC customers in the UK have been unable to access online and mobile banking services, preventing them from authorising online card purchases on Black Friday.
Better Dwelling (2023-11-28)
The homeownership rate for young adults has spiraled lower within a span of ten years. Between 2011 and 2021, the ownership rate for those between 25 and 44 has dropped at least 5 points. A decline was also seen for people aged 45 to 74 years old, but not to the same extent.
G&M - Jameson Berkow (2023-11-28)
Canadian businesses rejected by banks are increasingly turning to private lenders for financing, as demand for capital outstrips supply in the traditional debt market.
Secured creditor Toronto-Dominion Bank reluctantly went along with reprieve. It was TD's decision earlier this month to call in $5.5 million in loans that triggered the creditor protection proceedings.
CBC - Peter Zimonjic (2023-11-28)
"I really recognize that with interest rates having gone up very quickly, there are many, many Canadians who are concerned about their mortgages going up. They are concerned about being able to afford to stay in their own homes," Freeland said. "What we're saying today is we understand this is a challenging situation and we are here to help."
Alastair Marsh and Natasha White (2023-11-28)
But nations experiencing the fastest increase in emissions are also those facing the biggest hurdles when it comes to accessing private capital. With that in mind, a key goal of the COP28 talks will be to come up with so-called blended finance models, whereby private investors get incentives to join public institutions in committing capital to climate projects, without the terms becoming too onerous for debtor nations.
Yahoo Finance - Innes Ferre (2023-11-28)
"My technical target for gold is $2500/oz, and it looks appealing to be long precious metals given falling real rates, rising cycles and ongoing geopolitical conflict," said Newton.
FP - Barbara Shecter (2023-11-28)
Credit losses and expense controls will be closely watched when Canada’s big banks begin to roll out fourth-quarter earnings on Nov. 28, results that come as households and businesses contend with higher interest rates and the economic outlook casts a cloud over revenue growth expectations.
“The market is anchored on higher losses in (fiscal) 2024” as the economic outlook dims, Holden wrote, adding that fourth quarter results and management commentary are unlikely to change that view.
Reuters - Sinead Cruise and Carolyn Cohn (2023-11-28)
"We had it really good in the last 25 years but now financing costs are higher and returns will have to come either from rental growth, or from adding value to properties," Jose Pellicer, head of investment strategy at M&G Real Estate said.
Bloomberg - Christine Dobby (2023-11-28)
Bank of Nova Scotia missed fiscal fourth-quarter profit estimates as the company set aside more money than expected for potentially souring loans.
Bloomberg - Geoffrey Morgan and Layan Odeh (2023-11-28)
A meandering benchmark index and a slew of companies going private have left Canada’s capital markets in a precarious position.
Investment Executive - Ian Bickis (2023-11-28)
“The key trend in the banking industry right now is really the decrease in lending across the Canadian market,” said Shilpa Mishra, managing director in BDO’s capital advisory services.
Investment Executive - James Langton (2023-11-28)
Banks that are on the list face added capital requirements and extra supervisory attention on the basis that they are large and/or interconnected enough that their failure could have consequences for the global financial system.
Better Dwelling (2023-11-28)
Their optimistic scenario, where things are better than expected, doesn’t show much of an improvement. A booming economy is only expected to push home prices 1.3% higher over the next 12 months. The medium-term outlook expects compound annual growth of 4.2% for the following 48 months.
Investment Executive - James Langton (2023-11-28)
Alongside the proposed changes to dispute resolution, the government said that boosting the maximum penalty for securities violations will create a more effective deterrent, and more closely align Saskatchewan’s regime with other Canadian jurisdictions.
Investment Executive - James Langton (2023-11-28)
“We’re putting in place a simple, easy to understand regime so investors can judge whether funds meet their investment needs — this is a crucial step for consumer protection as sustainable investment grows in popularity,” said Sacha Sadan, director of environmental, social and governance at the FCA, in a release.
Forbes - Britney Nguyen (2023-11-28)
Munger, who was born in Omaha, Nebraska, dropped out of the University of Michigan to become a meteorologist in the Army during World War II, but later earned a law degree from Harvard. Munger moved to California after graduating from Harvard in 1948, and practiced real estate law before founding the law firm Munger, Tolles & Olsen in 1962, where he then managed investments at a hedge fund he also founded that year called Wheeler, Munger & Co., according to CNBC.
Forbes - Christopher Marquis (2023-11-28)
At the same time, there’s been this massive flow of capital into impact investment. There is a huge segment of the population that has a strong desire to align their investments with a set of underlying values and impact they want to see in the world. Case in point: Impact investment is now a multi-trillion dollar asset class (depending on who you ask). But a lot of the public funds out there attempting to meet this need leave a lot to be desired from an actual impact perspective. They are mostly “do less harm” - which is a model for socially conscious investment from 10 years ago or more. Today’s model asks: How do I use my capital to affect positive change?
Argentina’s President-elect Javier Milei said on Friday that the closure of the country’s central bank, a signature campaign pledge, was a “non-negotiable matter”, according to a statement from his office posted on social media platform X.
G&M - Stefanie Marotta (2023-11-27)
Canada’s banks are expected to book weaker profits, capping off a fiscal year marked by spiking expenses, rising capital requirements and higher provisions for potentially bad loans.
G&M - Stefanie Marotta (2023-11-27)
In his first remarks to investors as the new head of Bank of Nova Scotia, newly minted chief executive officer Scott Thomson zeroed in on the lender’s beleaguered international business.
Yahoo Finance - Pamela Heaven (2023-11-27)
Home sales that reached a peak of 64,000 in early 2021 are now down 45 per cent, said Canadian Imperial Bank of Canada’s housing market outlook. That’s 12 per cent below their pre-pandemic 10-year average.
Yahoo Finance - Emily Graffeo (2023-11-27)
It’s the latest lesson on the dangers of market timing. Investors wanted exposure to companies with a history of paying out profits as a precaution amid the Federal Reserve’s most aggressive tightening cycle in 40 years. Instead they were saddled with underperforming companies that proved especially vulnerable when yields shot higher.
Yahoo Finance - Sagarika Jaisinghani (2023-11-27)
After broadly failing to predict the equity rally in 2023, market forecasters have turned more optimistic about the outlook for next year as investor sentiment improves and expectations of a recession are dialed back.
Yahoo Finance - Gautam Naik and Saijel Kishan (2023-11-27)
Stotzel said he’s “worried we’ll get an AI blowback,” which he describes as a situation in which something unexpected triggers a meaningful market decline. “It takes just one incident for something to go wrong and the material impact could be significant,” he said.
Yahoo Finance - Ben Westcott and Swati Pandey (2023-11-27)
The move is another step by Chalmers to overhaul Australia’s central bank and its culture by installing someone from an offshore institution. The RBA has historically promoted internally and has been criticized for being overly insular and lapsing into group think.
FP - Noella Ovid (2023-11-27)
Reuters - Nate Raymond (2023-11-27)
The company as part of a plea deal agreed to pay more than $4.3 billion. Zhao has agreed to pay a $150 million penalty to the U.S. Commodity Futures Trading Commission, and prosecutors in a Wednesday filing said he faces up to 18 months in prison.
Bloomberg - Cristiane Lucchesi and Daniel Cancel (2023-11-27)
Brazilian retailer Americanas SA reached an agreement with bank creditors to overhaul some of its debt, in a key step toward eventually exiting bankruptcy protection.
Investment Executive - Jonathan Got (2023-11-27)
A government-led body will supervise the open banking system, enforce its rules, accredit institutions and update technical standards. The Department of Finance aims to adopt the legislation and implement the governance framework by 2025.
Investment Executive - Mark Burgess (2023-11-27)
“The trusts can also provide an alternative business succession option for retiring business owners, especially since more than 75% of small business owners plan to exit their business in the next decade,” the economic statement said.
Bloomberg - Ainsley Thomson (2023-11-27)
Australia’s younger adults are increasingly embracing buy now, pay later services, with more than 40% of 18 to 39 year olds holding installment loans in the past year, a sharp uptick from the 2019 figure, according to a Reserve Bank of Australia survey.
Fintech - Eva Zhang (2023-11-27)
Social commerce has taken off with strong Gen Z adoption and an expected 34% annual growth rate in Western Europe looking towards 2025, according to figures from Deloitte.
Forbes - Chris Walton (2023-11-27)
The right starting partner for Amazon to sell cars online is a brand that is as true to utilitarianism as Amazon is, a brand that consumers can understand right from the get-go because, cognitively, the idea of buying a car online is already a big enough adjustment for most consumers.
As mentioned in the notice published on October 4, 2023, our new Supervisory Framework, which will come into effect on April 1, 2024, represents a comprehensive update to how we supervise federally regulated pension plans (FRPPs) and federally regulated financial institutions (FRFIs). The new framework will apply to both FRPPs and FRFIs and recognizes the specific nature of the different industries we regulate.
Central 1 (2023-11-27)
• Annual CPI decelerates to 3.3 per cent.
Central 1 (2023-11-27)
• Monthly and yearly CPI down in October
Now - Breanna Marcelo (2023-11-27)
1. Temporary extensions of the amortization period for mortgage holders at risk;
CBC - Stephanie Kampf, David Common, Katie Pedersen (2023-11-24)
AFG charged Clarke for the work using a legal tool to place a financial claim against her home in Ontario — it's called a Notice of Security Interest (NOSI). A NOSI can be registered on the title of a property by companies when they finance or lease equipment on a property as a form of assurance that the contract will be paid.
Yahoo Finance - Pamela Heaven (2023-11-24)
“The housing market in Canada is in recessionary territory, as it faces its most significant test since the 1991 recession,” said CIBC economists Benjamin Tal and Katherine Judge.
Yahoo Finance - Jack M. Mintz (2023-11-24)
Canada may not be broken but the federal government is all but broke and is clearly running out of steam. With a weak economy growing only a little faster than population, there is not a lot of spending room left, not unless deficits and debts are cranked up again. As it is, debt as share of GDP jumps from 41.7 per cent in fiscal year 2022/23 to 42.4 per cent in 2023/24. So much for the fiscal anchors we were promised.
Yahoo Finance (2023-11-24)
The premiers’ letters, arguably, make for good politics: There is little to lose, and central bankers are an easy target. And besides, the premiers have no formal sway over monetary policy, anyway, so why not try to score some points with voters?
"Almost two-thirds of savings banks and credit cooperatives now have unrealised losses throughout their banking book, which comprises loans as well as securities," Buch said in a statement. "Life insurers are in a similar situation."
Bloomberg - Tom Metcalf (2023-11-24)
Barclays Plc is working on plans to reduce costs by as much as £1 billion ($1.3 billion) over several years, which could involve slashing as many as 2,000 jobs, according to Reuters.
Better Dwelling (2023-11-24)
A combination of spending and transfers to households helped produce excess consumption. Scotiabank estimates 200 basis points (bps), or 2 points, of the 475 bps increase to the overnight rate was due to government spending. They found that government consumption has outpaced gross domestic product (GDP) significantly since 2019. It doesn’t exactly look like a smart decision, since it’s failing to drive the growth one expects.
Investment Executive - Rudy Mezzetta (2023-11-24)
The annual TFSA dollar limit is indexed to inflation and rounded to the nearest $500. The CRA’s indexation increase for 2024 is 4.7%, down from 6.3% in 2023.
TD economists answer questions such as:
What has driven bond yields?
Why is the US outperforming?
Is Canada already in a recession?
How will consumers fare if rates rise?
Is a real estate correction coming?
“For years, Binance allowed users to open accounts and trade without submitting any identifying information beyond an email address,” the Justice Department said.
Bank of Canada Governor Tiff Macklem said borrowing costs may now be “restrictive enough” to get inflation under control, his most explicit comments to date suggesting that interest rates have peaked.
Ottawa wants Canadian pension funds to invest a larger share of their assets in Canada and is promising measures to make it a more attractive option, as advocates for raising domestic investment have clashed with pension managers intent on guarding their independence.
G&M - Susan Krashinsky (2023-11-23)
The news follows significant cutbacks at Hudson’s Bay: the retailer cut its corporate offices in a bid to “streamline operations.”
It was Sunday night of the Labour Day long weekend, and over the previous 60 hours, the CEO of Bank of Montreal had been fixated on a finely choreographed operation playing out across 24 U.S. states: the conversion of 1.8 million customer accounts and more than 500 branches from Bank of the West to BMO.
Binance chief Changpeng Zhao stepped down and pleaded guilty to breaking U.S. anti-money laundering laws as part of a $4.3 billion US settlement resolving a years-long probe into the world's largest crypto exchange, prosecutors said on Tuesday.
Yahoo Finance - Jeff Lagerquist (2023-11-23)
The Trans Mountain Pipeline expansion project, stretching from Alberta to British Columbia, is expected to start operating in the first quarter of 2024. It’s set to ship an extra 590,000 barrels per day of crude to the West Coast.
Yahoo Finance - Cagan Koc and Diederik Baazil (2023-11-23)
Wilders’s victory presents a challenge to the European Union project in one of the bloc’s six founding members as the world braces for the potential return of Donald Trump after next year’s US election.
Canadian home prices are likely to fall twice as much as previously expected, according to economists at Toronto-Dominion Bank, as persistently high borrowing costs and an unexpected surge in listings puts more downward pressure on the market.
Germany's financial firms may be well capitalised now but face challenges ranging from rising interest expenditure and weak loan demand to unrealised losses, Bundesbank Vice President Claudia Buch said on Wednesday.
"While cards make a tremendous contribution to the payments landscape, we heard notable dissatisfaction with the cost of card schemes on the part of shops, services, and other merchants – which may be in part due to a lack of choice or digital alternatives to the existing card schemes," the review said.
Bloomberg - Christine Dobby (2023-11-23)
Royal Bank of Canada wanted to return to the US personal and commercial banking business, and City National Bank seemed to have it all: wealthy Hollywood clients, a foothold in the massive California market and a long history of churning out profits.
Bloomberg - Tanaz Meghjani (2023-11-23)
A quirk in retirement fund accounting is making corporate pensions look particularly flush now, giving them more incentive to cut risk by dumping equities and buying bonds.
Investment Executive - Mark Burgess (2023-11-23)
Like the private credit fund Wealthsimple launched in March with Sagard, the private equity fund is open-ended, with quarterly redemptions up to a limit of 5% of the fund’s assets. The management fee is 1.5%, with a 12.5% performance fee that kicks in at an 8% hurdle.
Indian country, and the politicians roaming within it, is awash in talk about the loan guarantee program announced by the federal government on Tuesday and the panacea they represent for First Nations anxious to gain a foothold in energy and infrastructure projects as full, equity partners.
Long before Ilya Sutskever moved to oust OpenAI chief executive Sam Altman, throwing the world’s most prominent artificial intelligence company into chaos...
G&M - Matt Lundy (2023-11-22)
Canada’s inflation rate slowed markedly in October, bolstering views on Bay Street that the Bank of Canada is done raising interest rates and will start to cut them next year.
G&M - Bill Curry, Mark Rendell (2023-11-22)
Finance Minister Chrystia Freeland announced billions in spending on Tuesday, in a housing-focused fall economic statement that also set a new cap on the size of future deficits, pledging to keep them at no larger than 1 per cent of gross domestic product.
Yahoo Finance (2023-11-22)
He said consumers who opt for a fixed-rate mortgage with a shorter term will pay more in interest than those that choose a long-term fixed-rate loan. Homeowners have to be strategic in choosing the type of mortgage to make sure they're able to save money, he said.
Yahoo Finance (2023-11-22)
As first reported by CBC News, the federal government's fall fiscal update includes $16 billion in funding to build rental and social housing, along with targeted measures to combat inflation. All in, new spending will total about $21 billion as the government faces another whopping deficit.
Yahoo Finance (2023-11-22)
San Francisco-based OpenAI said in a statement late Tuesday: “We have reached an agreement in principle for Sam Altman to return to OpenAI as CEO with a new initial board" made of former Salesforce co-CEO Bret Taylor, former U.S. Treasury Secretary Larry Summers and Quora CEO Adam D’Angelo.
Yahoo Finance - Jack Wittels, Yongchang Chin and John Ainger (2023-11-22)
Under the regulation, which takes effect Jan. 1, vessels going into and out of EU ports must pay for their carbon pollution, affecting deliveries of everything from container loads of finished goods to the liquefied natural gas needed to keep homes warm in winter.
Reuters - Tom Wilson (2023-11-22)
Binance chief Changpeng Zhao on Tuesday stepped down and pleaded guilty to breaking U.S. anti-money laundering laws as part of a $4.3 billion settlement resolving a years-long probe into the world's largest crypto exchange, prosecutors said.
The SoftBank-backed (9984.T) company is seeking to address more than $4 billion in debt and unsustainable future rent costs through a bankruptcy plan.
Bloomberg - Paula Seligson (2023-11-22)
Citigroup Inc. is in discussions to start a new direct-lending strategy by early January, the latest in a series of bank efforts to gain a foothold in the booming $1.6 trillion private credit market.
Investment Executive - James Langton (2023-11-22)
“The whole point of creating statutory priorities is to alert the world regarding the distribution scheme for a given fund. The idea is to create certainty so that claimants understand where they stand relative to other claimants. A clear priority scheme also makes it easier for courts to adjudicate competing claims,” the appeal court said.
Investment Executive (2023-11-22)
Last week, the regulator removed Gary Brown as director of Toronto-based Rapport Credit Union, an enforcement order said.