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'Pros on the Go', a Fierce Tartan company are seeking insurance partners to pilot its new solution for streamlining the claims process.


Using financial data, Mark Sibthorpe compares the performance of TD bank to its rivals. TD grew faster in 2017 than its rivals, but was cited for aggressive sales practices.


Mr. Michael R. King, Tangerine Chair in Finance and Co-Director, Scotiabank Digital Banking Lab / Ivey Business School at Western University


This video covers XE.com's presentation at the AI, Big Data and Analytics event which took place in Toronto February 7/8, 2018. Cecelia Tamez and Jean Louis provide insights into their evolution and winning strategy.


Greenpeace's campaign to stop TD financing the oil sands is delusional. Trillions of dollars are at stake for the banks and the Canadian economy. This video explores the related financial issues.


This video provides an overview of the main differences between Canada's approach to overland flooding versus the US approach.


Canadian bank overview part 5, medium-large banks. Banks include Manulife, Tangerine and Laurentian Bank.


Canadian banking industry overview of Canadian Tire Bank, Presidents Choice Financial, Equitable Bank, B2B Bank


Overview of small-medium size banks in Canada. Banks covered include Versabank, Hollis Bank, Equity Bank and Caisse Populaire Acadienne.


Review of small banks including Bridgewater,Vancity Bank, Concentra, Wealth One, Zag...


Jamie Dimon calls bitcoin a fraud used by criminals, yet he has jumped into the blockchain with both feet.


RBC invested $24 million into Wave Technologies and now they will roll out Waves accounting, invoicing, reporting and billing platform to SMEs.


Overview of Canadian banking industry. This multi-part series looks at issues facing Canadian banks from a variety of angles. Part 1 examines the types of banks and scale using ROE and EBITDA as measures.


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About BankNews TV: financial services industry monitor (FSIM), analytics and research

Latest news and events for Canadian financial service companies, analytics, fintech and AI. BankNews.TV provide the latest technology news and reports for banks and insurance companies looking to compete in a rapidly changing market.

Analytical information and financial information related to technogies that can change your business.

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Research

VersaBank Beta-Testing Its New, High Volume Mortgage Finance App   

fsim.ca/docs/VBCortelMortFinanceAppFeb62020.pdf

Press Release

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  

Mark Sibthorpe

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)  

fsim.ca/docs/Kick.pdf

Mark Sibthorpe

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  

fsim.ca/docs/ScoreCardMorneau.pdf

Mark Sibthorpe

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.  

fsim.ca/docs/Observations and overview of 2018 NB flood support from government and insurance companies..pdf

Mark Sibthorpe

 


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  

fsim.ca/docs/Update Argentina_ a sign of the times.pdf

Mark Sibthorpe

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  

fsim.ca/docs/Summary-of-flood-news-2017-present.pdf

Mark Sibthorpe

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  

fsim.ca/docs/c10191_banking-on-pot.pdf

SBS

As states across the US legalize marijuana for both medicinal and recreational purposes, it has fueled a growing industry of marijuana related businesses (MRBs).


Canadian banking industry overview  

Mark Sibthorpe

The industry overview is divided into 5 parts:

Introduction
Small banks
Small medium sized banks
Medium sized banks
Medium large banks


2014 Mobile payments the Apple pay way  

fsim.ca/docs/Mobile_Payments_Apple_Pay_2014.pdf

Mark Sibthorpe

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)

Mark Sibthorpe

Jamie Dimon calls bitcoin a fraud used by criminals, yet he has jumped into the blockchain with both feet.


TD bank industry conduct  

fsim.ca/docs/tdind2.pdf

Mark Sibthorpe

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  

fsim.ca/docs/backbrink.pdf

Mark Sibthorpe

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  

fsim.ca/docs/footnote151.pdf

Mark Sibthorpe

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  

fsim.ca/docs/helecopter-money.pdf

Mark Sibthorpe

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  

fsim.ca/docs/Gamfin.pdf

Mark Sibthorpe

Gamification of business processes resulted on Mint.com growing to 10 million users within 4 years. This report explains how.


National Bank Special Report  

fsim.ca/docs/NatBSpec.pdf

Mark Sibthorpe

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?  

fsim.ca/docs/depgrowthimpact2.pdf

Mark Sibthorpe

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  

fsim.ca/docs/ctfsfinal.pdf

Mark Sibthorpe

Review of the Canadian Tire Financial Services deal with Scotiabank, risks, opportunity and benefits.


Finance minisiter scorecard August 26, 2015  

fsim.ca/docs/Scorejo-August-2015.pdf

Mark Sibthorpe

This report looks at Joe Oliver, minister of finance’s progress to date, and assigns a grade to his government’s performance to date.


Xtreme Branch  

fsim.ca/docs/xbranch.pdf

Mark Sibthorpe

Branches are evolving to meet the digital age. This documents tracks the evolution with real-world examples.


Canadian Nudge  

fsim.ca/docs/nudge.pdf

Mark Sibthorpe

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  

fsim.ca/docs/cwbupdate.pdf

Mark Sibthorpe

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.


BNTV Overview  

fsim.ca/docs/overviewpdf.pdf

BNTV

BankNews.TV Publishing Corp services overview document:

  • Analytics
  • Financial services industry monitor (FSIM) industry briefings and developments reports
  • Research


Challenger banks not a threat to big banks  

fsim.ca/docs/challenger.pdf

Mark Sibthorpe

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  

fsim.ca/docs/GamingEventProposal-printsample--en-final.pdf

Mark Sibthorpe

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  

fsim.ca/docs/irr-f.pdf

Mark Sibthorpe

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  

fsim.ca/docs/goldenballs.pdf

Mark Sibthorpe

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  

fsim.ca/docs/Scorecard Min Fin Flaherty April 8 2014.pdf

Mark Sibthorpe

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  

fsim.ca/docs/sample RFP for a loyalty program.pdf

Mark Sibthorpe


Merchants extend financial services  

fsim.ca/docs/merchantfs.pdf

Mark Sibthorpe

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  

fsim.ca/docs/hotmoney.pdf

Mark Sibthorpe

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  

fsim.ca/docs/currencycheatsheet.pdf

Mark Sibthorpe

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.  

fsim.ca/docs/gq4risk.pdf

Mark Sibthorpe

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  

fsim.ca/docs/cwbf.pdf

Mark Sibthorpe

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  

fsim.ca/docs/Liquid.pdf

Mark Sibthorpe

This report examines liquidity issues in the Canadian financial service industry.


Bank Fees  

fsim.ca/docs/Bank fees.pdf

Mark Sibthorpe

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  

fsim.ca/docs/co2.pdf

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  

fsim.ca/docs/ces.pdf

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.
 


Complete loyalty RFP  

fsim.ca/docs/booksample.pdf

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.
 


Mobile Payments Blueprint: guide to credit and loyalty transformation for merchants  

fsim.ca/docs/booksample.pdf

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.
 


Report on merchants extending financial services  

fsim.ca/docs/

Special report explaining why some merchants in the UK, U.S. and Canada are expanding their financial services. The paper discusses the structural and regulatory pressures facing merchants and explains the rational behind key decisions. This is an 8 page high level report
 


Guide to system selection  

fsim.ca/docs/gssnow.pdf

Read sample report: Guide to system selection. This sample would normally cost $99 but is available free as a sample. Click here view sample report.


News feed

UBS WEALTH BANKERS GET DOSE OF CREDIT SUISSE TONIC IN KHAN PLA

Bloomberg - Patrick Winters and Marion Halftermeyer (2020-12-17)

Colleagues say the Pakistan-born executive is enthusiastic, energetic and talented. Former associates have described him as confident, even overly so. That said, he knows the business from several angles: Khan was a UBS auditor at Ernst & Young and a key competitor at Credit Suisse.


HOW CAN INSURANCE BROKERS USE RATE COMPARISON SITES TO BOOST THEIR BOOKS OF BUSINESS?

Insurance Business - Bethan Moorcraft (2020-12-07)

Enter, rate comparison websites. They’re all the rage in the UK and the USA, where consumers use comparison sites to shop for insurance much like Canadians do when comparing travel costs on sites like Expedia and Trivago. But Canadians are slowly starting to catch on to the insurance comparison trend. They’re searching for and finding platforms like LowestRates.ca, which is enabling consumers to compare insurance premium prices across a number of product lines, primarily in auto and home insurance.


BOAZ MANOR, BUSINESS PARTNER INDICTED ON FRAUD CHARGES IN U.S. OVER BLOCKCHAIN VENTURE

FP - Barbara Shecter (2020-10-20)

Boaz Manor, a former Canadian hedge fund manager who served jail time following the collapse of Portus Alternative Asset Management Inc. in 2005, was indicted Friday on fresh criminal charges in the United States in connection with an alleged securities fraud scheme at an entirely different venture: a New York-based blockchain technology startup.


CHRISTINE LAGARDE GETS A HEAVY POINTER ON HER ECB REVIEW

Bloomberg - Ferdinando Giugliano (2020-06-20)

Nevertheless, Lagarde and her colleagues would be wise to read the staff paper closely. Among all the carefully worded language, one can clearly see the contours of a monetary framework that would work for the ECB’s third decade. These include changing the inflation target to 2%, and maintaining all of the instruments — asset purchases, long-term loans to the banking system and negative interest rates — that the central bank used throughout the presidency of Lagarde’s predecessor, Mario Draghi. 

The argument for a symmetric inflation target is rooted in the power of expectations. The ECB at the moment aims to reach an inflation rate “close to but below 2%.” This means that, as price pressures start climbing toward 2%, investors and consumers expect the ECB to react aggressively, tightening monetary policy to push inflation back. The authors believe this served the ECB well during its first decade, when it had to establish its reputation and fight off inflationary forces. However, the objective has been less useful in today’s era of persistently low inflation. It may even be counterproductive. Consumers and investors don’t expect the central bank to act so decisively to counter deflation.  


WEB OF DEALS: PACE CREDIT UNION EXECUTIVES COMMITTED CIVIL FRAUD WITH YEARS OF ‘SECRET’ PAYMENTS, REGULATOR ALLEGES

G&M - James Bradshaw (2020-04-23)

It is a convoluted web of suspect dealings and payments that stretches back more than two decades.


CORONAVIRUS IS PUSHING ITALY TOWARD FOURTH RECESSION SINCE 2008, AND EU ECONOMIC CONTAGION IS LIKELY

G&M - Eric Reguly (2020-02-26)

If there is a European country that can ill afford the coronavirus outbreak, it is Italy. The European Union’s third-largest economy and Group of Seven member never got its act together after the financial crisis and is on the verge of its fourth recession in a dozen years.


BIG BANKS REPORT RECORD HIGHS IN CAPITAL MARKETS RESULTS

G&M - Mark Rendell (2020-02-26)

A spike up in fixed income trading revenue and investment banking fees is driving exceptional quarterly results for the capital markets divisions of Canada’s large banks, with three of the Big Six so far reporting stronger results for the fiscal first quarter of 2020.


BANK OF CANADA DECIDES AGAINST LAUNCHING DIGITAL CURRENCY, BUT LEAVES DOOR OPEN

G&M - DAVID PARKINSON (2020-02-26)

The Bank of Canada doesn’t yet see a need to create its own digital currency, even as some central banks advance toward e-money.


MERIDIAN CREDIT UNION RAISES $125-MILLION IN DEBT FROM QUEBEC’S CAISSE

G&M - Mark Rendell (2020-02-26)

Meridian Credit Union Ltd. raised $125-million in debt from the Caisse de dépôt et placement du Québec, as the credit union seeks to keep capital in line with aggressive plans for expansion.


U.S. BANKS MADE $233.1-BILLION IN PROFITS IN 2019, REGULATOR SAYS

G&M - Ken Sweet (2020-02-26)

The banking industry collectively made $233.1 billion in profits in 2019, the Federal Deposit Insurance Corporation said Tuesday, the industry’s second-most profitable year ever.


LUXURY HOME PRICES JUMP IN SOME PARTS OF CANADA AS BOOMERS, YOUNG EXECUTIVES COMPETE WITH FOREIGN BUYERS

FP - Colin McClelland (2020-02-26)

Prices of luxury homes in the main cities of Eastern Canada rose during the past year while they fell in Western Canada, in part reflecting regional disparities and overheated markets, according to real estate company Royal LePage.


BANK OF ENGLAND TELLS LENDERS TO ACCELERATE MOVES TO DITCH LIBOR

Reuters - Reuters (2020-02-26)

The Bank of England told banks on Wednesday to accelerate their efforts to ditch the use of Libor if they want to avoid facing more punitive terms when borrowing from the central bank.


JPMORGAN GETS BUSY IN REPO LENDING AFTER REGULATORY NOD: CFO

Reuters - Matt Scuffham, David Henry (2020-02-26)

It is also headed to the “discount window” – the Federal Reserve’s funding-source-of-last-resort – in an effort to help diminish the reputational stain attached to its use and promote alternative funding options in the wake of last year’s frightening bout of volatility in money markets.


HSBC TARGETS THE GLOBALLY MOBILE WITH $1.4 TRILLION WEALTH BUSINESS

Reuters - Lawrence White (2020-02-26)

The plan is to grow in the three major markets where HSBC has scale, namely Britain, Hong Kong and Mexico, focusing on mortgages, wealth and insurance products, and unsecured lending respectively.


BANK OF CANADA LAYS GROUNDWORK FOR DIGITAL CURRENCY

Bloomberg - Eric Hertzberg (2020-02-26)

The Bank of Canada is laying the groundwork to introduce a digital currency, should the need for one emerge, Deputy Governor Tim Lane said.


JPMORGAN WARNS INVESTORS IT MAY GET WALLOPED BY CLIMATE CHANGE

Bloomberg - Michelle F Davis (2020-02-26)

Chief Executive Officer Jamie Dimon, another target of environmentalists, has said climate change will be solved with government policy.

“I’ve always thought it was a problem,” Dimon said at the bank’s investor day earlier Tuesday. “We should acknowledge the problem and start working on it.”

Financial firms often include dozens of disclaimers about potential risks in their annual 10-K filings, but JPMorgan’s have typically focused on those more directly related to the economy, regulation and competition. Meanwhile, economists at the firm have been warning clients about the potential for climate change to threatenthe global economy and even the human race.


WHO’S IN, WHO’S OUT AT EUROPE’S BIGGEST BANKS

Bloomberg - Yalman Onaran (2020-02-26)


INVESTORS CAST DOUBT ON BENEFITS OF PRUDENTIAL SPLIT

FT - Oliver Ralph and Attracta Mooney (2020-02-26)

UK investors have poured cold water on an aspiration by hedge fund Third Point to double Prudential’s valuation by breaking up the UK’s biggest listed insurer.


HUNT FOR NEXT CHIEFS PUTS EUROPE’S BANKS TO TEST

FT - David Crow, Stephen Morris and Nicholas Megaw (2020-02-26)

European banks are facing tough questions about succession planning and corporate governance as they scramble to find a new generation of chief executives amid the biggest shake-up of the industry’s top ranks since the financial crisis. In the past three months alone, two-thirds of the largest 15 European listed banks have either switched the top job or started preparing to find a new chief executive. The synchronised changeover presents challenges. Bank executives, board directors and external headhunters interviewed by the Financial Times all warned of a shallow pool of candidates to choose from and the difficulty that European banks will have attracting executives from the US, where the pay is significantly higher.


INVESTORS DUMP BANK STOCKS AS PROFIT SQUEEZE WORSENS

FT - Robert Armstrong (2020-02-26)

Bank stocks had their worst day since December 2018 on Tuesday after fears over the coronavirus pushed bond yields sharply lower for the second time in two days, threatening to worsen a profitability squeeze across the industry. The share price rout came on the same day that the Federal Deposit Insurance Corporation, a US regulator, reported that US banks’ underlying profits fell in the fourth quarter of 2019 by the most since the financial crisis. The KBW bank index fell 4.5 per cent, with rate-sensitive lenders such as Bank of America, Capital One and PNC Financial all falling by 5 per cent or more on the day.


OUCH. INVESTMENT BANKING REVENUE HASN'T BEEN THIS WEAK SINCE 2008

CNN - Matt Egan (2020-02-26)

Revenue at the top 12 global investment banks fell 3% in 2019 to the weakest level since the chaos of the 2008 financial crisis, according to Coalition, a business intelligence provider. Revenue is down for the fourth year out of the past five.


PROPOSED CLASS ACTION FILED AGAINST SUN LIFE

Investment Executive - IE (2020-02-26)

A proposed $10-million class action lawsuit alleges that Sun Life Assurance Company of Canada knowingly miscalculated benefits paid to federal employees receiving long-term disability (LTD) payments.


VERSABANK REPORTS CONTINUED STRONG FINANCIAL RESULTS FOR FIRST QUARTER 2020, WITH 15% GROWTH IN ECOMMERCE PORTFOLIO FROM A YEAR AGO

VersaBank - Press Release (2020-02-26)

“Our continuing strong financial results for the first quarter of 2020 build on the momentum of last year’s record performance,” said David Taylor, President and CEO, VersaBank. “Importantly, VB’s assets increased by 4% over the previous quarter mainly to our continued success in expanding our eCommerce portfolio, which grew by a very healthy 7%. Our eCommerce business continues to represent significant potential for VB, and we are pleased to be pursuing numerous opportunities to drive significant growth.” 


AIRLINES SLASH COSTS AS CORONAVIRUS CRISIS DEEPENS

G&M - LAURENCE FROST AND SARAH YOUNG (2020-02-26)

Airlines rattled by the coronavirus rushed to cut costs on Wednesday, as warnings of a pandemic deepened concern about the scale of the impact on aviation and other front-line sectors.


WALMART IN TALKS WITH THIRD PARTIES OVER INVESTMENT IN U.K. ARM ASDA

G&M - James Davey (2020-02-26)

Walmart, the world’s largest retailer, is in talks with possible buyers of a stake in its British supermarket Asda, which it failed to combine with Sainsbury’s last year.


CIBC POSTS PROFIT GAIN, HIKES DIVIDEND AS BANK SHUFFLES EXECUTIVE RANKS, BOOKS RESTRUCTURING CHARGE

G&M - James Bradshaw (2020-02-26)

Canadian Imperial Bank of Commerce increased quarterly profit by 3 per cent and raised its dividend, but also shuffled its executive ranks and took a $339-million restructuring charge.


OTTAWA’S CLIMATE-ENERGY POLICY CONFLICT SINKS TECK’S FRONTIER OIL-SANDS PROJECT

G&M - Andrew Willis, Robert Fife (2020-02-25)

Alberta’s Premier privately urged Teck Resources Ltd. to move forward with the Frontier oil-sands mine project, despite the company’s fear it was becoming mired in intractable climate-change controversy.


PENSION PLAN FOR FEDERAL PUBLIC SERVANTS LAUNCHES ITS OWN REAL ESTATE DEVELOPMENT COMPANY

G&M - Rachelle Younglai (2020-02-25)

The pension plan for federal public servants is getting into real estate development, hiring an executive from an established Canadian builder and creating a separate company to develop a sizable swath of land northwest of downtown Toronto.


STOCK MARKETS SELL OFF AS CORONAVIRUS SPREAD THREATENS GLOBAL ECONOMY

CBC - AP (2020-02-25)

More than 79,000 people worldwide have been infected by the new coronavirus. China, where the virus originated, still has the majority of cases and deaths. But, the rapid spread to other countries is raising anxiety about the threat the outbreak poses to the global economy.


BLOWS KEEP COMING FOR OUR ECONOMY, AND THE BANK OF CANADA WILL BE LEFT TO CLEAN UP THE MESS

FP - Martin Pelletier Martin Pelletier (2020-02-25)

Manufacturing sales have posted their fourth consecutive negative reading, retail sales were stagnant to end 2019 and signs are that GDP growth is stalling and may actually be negative when accounted for on a per-capita basis.


THE ROAD TO THE MILLION-DOLLAR TFSA IS GETTING SHORTER FOR MILLENNIALS

FP - Jonathan Chevreau (2020-02-25)

If you’re a millennial just embarked on saving and investing, you should know the opportunity to put another $6,000 into your TFSA as of Jan. 1 each year is one you shouldn’t pass up. Why? There are a million reasons why doing so every January for the next 45 years is your best route to building a hefty retirement fund.


AUSTRALIA'S BANKS FACE DOS RANSOM DEMANDS

Finextra - Finextra (2020-02-25)

The actors behind the threats claim to be the ‘Silence Hacking Crew', a Russian-speaking advanced persistent threat group who have previous form in post-Soviet states and neighbouring countries.


SOFTBANK-BACKED GRAB RAISES $856 MILLION FROM JAPANESE INVESTORS IN FINANCIAL SERVICES PUSH

Reuters - Anshuman Daga, Takashi Umekawa (2020-02-25)

“MUFG’s investment into Grab is a vote of confidence in our super app strategy and our ability to build a long-term, sustainable business,” Ming Maa, Grab’s president, said in a statement on Tuesday.


CITI, CREDIT SUISSE AMONG BANKS CURBING ITALY TRIPS ON CORONAVIRUS FEARS: SOURCES

Reuters - Pamela Barbaglia, Valentina Za (2020-02-25)

 Investment banks including Citigroup Inc (C.N), Credit Suisse (CSGN.S) and Nomura Holdings Inc (8604.T) have curbed trips to Italy on fears that the coronavirus outbreak across the north of the country could quickly spread across Europe, four sources told Reuters.


CENTRAL BANKS SEEK AN EDGE IN A GAME THEY CAN’T WIN

Bloomberg - Mohamed A. El-Erain (2020-02-25)

Monetary-policy specialists are furiously exploring ways to improve central banks’ effectiveness, particularly should economies fall into a recession — a risk heightened by the coronavirus’s cascading economic stop. The underlying policy motivation is the growing recognition that prolonged and excessive reliance on central banks has reduced the power of both conventional and unconventional measures; it has even risked making them counterproductive. The hope is to come up with new tools to reverse this worrisome and accelerating phenomenon.

As important as this work is, I am worried that basic misperceptions risk making it unsuccessful when central banks face growing pressures both from within and without. To understand why, let’s look at this through the prism of game theory.

Key elements of any game — that is, strategic interactions between two or more participants — include the characteristics of the players, strategies and payoffs, information availability and the status of trust, cooperation and rationality. Good players choose their best strategies understanding what others are likely to do under a given set of conditions. Outcomes vary from destructive non-cooperative games to so-called Pareto optimal ones, in which a player is better off without any other being worse off.

For years, central banks had dominant strategies, using interest rates and forward guidance to press others to respond in ways that helped meet the banks’ economic and financial objectives. They informed and influenced the behavior of a broad range of economic actors and, sometimes, even directly imposed outcomes. This was seen in the smoothing out of business cycle extremes and, most vividly, in overcoming the 2008 financial sudden stop that was on the verge of tipping the global economy into a damaging multiyear depression.

In recent years, however, the strategies of systemically important central banks such as the Bank of Japan, the European Central Bank and the Federal Reserve have not been as effective, with repeated failures to meet one or more of their stated objectives. This is due in large part to what can be thought of as changes in game conditions.

Central banks appear to have less of an information edge. Combined with challenged analytical models, this has translated into repeated errors in growth projections and an underappreciation of the risk to financial stability because of pockets of excessive risk-taking among nonbanks, especially when it comes to liquidity risk. Repeated game conditions that once anchored central banks’ effectiveness now threaten to expose more shortcomings relative to objectives. No wonder central bank strategies are transitioning from “dominant” to “dominated,” especially with respect to markets that now feel more empowered to force the banks’ policy hand.


BOE’S HALDANE SAYS BREXIT UNCERTAINTY LIFTING FROM ECONOMY

Bloomberg - Lucy Meakin and Jill Ward (2020-02-25)

Most of the Brexit uncertainty that has been overshadowing the U.K. economy has lifted, although it’s too early to say business investment is fully returning, according to Bank of England Chief Economist Andy Haldane.

A “big chunk, if not all” of the uncertainty has dissipated, Haldane said in answer to questions following a speech at Bloomberg’s European headquarters in London Monday. That’s contributing to investment starting to pick up, but it’s “too early to declare victory,” he said.

Recent surveys on manufacturing, housing and consumers have improved, indicating the economy is beginning to bounce back after a year of huge political uncertainty related to Brexit. Retailers are planning to invest in the coming 12 months for the first time in two years, figures from the Confederation of British Industry showed Tuesday.

The Bank of England left interest rates unchanged last month, and the better economic numbers are undermining the argument of dovish policy makers that a cut is needed to support growth. Bloomberg Economics forecasts that the BOE won’t change its benchmark at all this year, holding it at 0.75%.

There are still Brexit risks, however. While Britain managed to agree a withdrawal deal with the European Union, it still has to negotiate a new trading relationship by the end of this year. The outbreak of the coronavirus could also weigh on global growth, with repercussions for the U.K.

Globally, the economy has grown stronger since the financial crisis more than a decade ago, Haldane said. Banks’ balance sheets are in better shape and he doesn’t see a buildup of new asset bubbles. While trade has been hurt by U.S.-China tensions, it will unlikely lead to a “wholesale retrenchment” of globalization, he said.


IIROC AIMS TO ADD RETAIL INVESTOR EXPERTISE TO ITS BOARD

Investment Executive - James Langton (2020-02-25)

The SRO has revised its criteria for independent directors.


BIG SIX BANKS WELL ARMED TO FACE SHOCKS: DBRS

Investment Executive - James Langton (2020-02-25)

Banks have bolstered funding and liquidity positions in the wake of 2008's global financial meltdown


RBC VENTURES ACQUIRES BILLING SERVICE FOR DOCTORS

Investment Executive - Maddie Johnson (2020-02-25)

The service provides physicians with access to a user-friendly mobile billing platform as well as live agents to modernize and streamline their billing process.


BREXIT PROMPTING CONSOLIDATION BETWEEN TRADITIONAL BANKS AND CHALLENGERS

Bobsguide - Emma Olsson (2020-02-25)

Earlier this month German challenger bank N26 announced that that they would withdraw from the UK market on April 15, citing Brexit as the reason. On February 3, the Telegraph reported that UK fintech Revolut will move its European payments base from London to Ireland and Lithuania after Brexit.


TORONTO AND VANCOUVER INCOMES DECLINE, WHILE CANADA IS “VIRTUALLY UNCHANGED”

Better Dwelling - Daniel Wong (2020-02-25)

Canadian households are seeing a few extra bucks in their pocket, but not enough to move the needle. The median after-tax income of Canadian families and unattached individuals reached $61,400 in 2018. This is a 0.82% increase compared to the year before, which Stat Can called “virtually unchanged.” The increase is substantially lower than the one seen in 2017 – the highest since 2001. It’s been a long time since the country saw an increase that large, and it’s probably going to be a while until the next one.


FCA ADMITS DATA BREACH

Finextra - Finextra (2020-02-25)

The FCA says that it inadvertently published the data in plain view on its Website in response to a Freedom of Information Act request.


MASTERCARD CEO BANGA TO STEP DOWN

Finextra - Finextra (2020-02-25)

News of the leadership transition comes a days after the payments giant warned that its 2020 revenues could be affected by the coronavirus outbreak.


CANADIAN CENTRAL BANK AGAINST THE SWEDISH APPROACH TO CBDCS

Invezz - Ali Raza (2020-02-25)

At a recent conference organized by Ukraine’s central bank, several central banks, including the Canadian central bank, were against the need for CBDCs. In their opinion, blockchain technology is not better than other digital alternatives, and they wouldn’t want to change anything to that effect now.


MAJOR MGM RESORTS BREACH IMPACTS TWITTER CEO AND JUSTIN BIEBER

Insurance Business - Lyle Adriano (2020-02-25)

“Last summer, we discovered unauthorized access to a cloud server that contained a limited amount of information for certain previous guests of MGM Resorts,” the hotel chain told ZDNet in its email.


HSBC TO CLOSE MORE BRANCHES AS MOBILE MIGRATION CONTINUES

Finextra - Finextra (2020-02-25)

The closures will see HSBC's UK branch network reduced to 594 - still the largest in the country. Around 50 jobs are at risk.


EUROPEAN PARLIAMENT CHALLENGES ECB ON GREEN CREDENTIALS AND CRYPTO REGULATION

Finextra - Finextra (2020-02-25)

MEPs deplored that green bond issuance still accounts for only one percent of the overall supply of euro-denominated bonds, while a majority (62.1%) of ECB corporate bond purchases remain in sectors that are responsible for 58.5% of euro area greenhouse gas emissions.


ELECTION 2020: IS NIGHTMARE SCENARIO CLOSER TO REALITY FOR BANKS?

American Banker - Neil Haggerty (2020-02-24)

Observers say a Sanders presidency could lead to a reversal of Trump regulatory relief initiatives, turnover at the top of the regulatory agencies, and a newfound focus on both enforcement actions and proposals that Sanders has supported in Congress to overhaul the banking industry's structure.

Jeffrey Naimon, a partner at Buckley LLP who defends financial services companies in enforcement matters, said that his clients are starting to consider the impact of a Sanders presidency.

“We are starting to see both banks and other financial services companies get interested because Sen. Sanders would represent a significant policy pivot, and obviously, federal policy has a great effect on the industry," Naimon said. "They are starting to consider what the possible ramifications might be, what initiatives they might take, and the kind of things they may not do.”Others say there is no cause for panicking just yet. Sanders, a democratic socialist, has jumped out to a sizable lead in delegates after strong showings in early state contests, including a commanding victory in the Nevada caucuses Saturday. But it is still early in the Democrats' nominating process, and the South Carolina primary and Super Tuesday could offer more clarity.

Some analysts and bank representatives say they believe President Trump would have the advantage going into a general election against Sanders. And even if Sanders won, many said the GOP is still likely to hold the Senate and he would face other hurdles to enacting reforms detrimental to the industry.

“I think very few see him as the president of the United States and I think that’s why the market is pretty sanguine about the election so far,” a banking industry source said on the condition of anonymity. “They see it either being Trump or [former New York City Mayor Mike] Bloomberg, or a couple of others. … If Bernie becomes the nominee, they think it is much more likely that Trump will stay president.”

Sanders, an independent who caucuses with the Democrats in the Senate, has long been one of the harshest critics of Wall Street in Congress, advocating for sweeping reforms such as breaking up the big banks and reinstating Glass-Steagall, among other things.

In May 2019, Sanders along with Rep. Alexandria Ocasio-Cortez, D-N.Y., introduced a bill to cap credit card interest rates at 15%, though it is viewed as dead on arrival in the current Republican-controlled Senate.

The previous October he introduced a bill that would cap a financial institution’s total exposure at 3% of the nation’s GDP, saying at the time that "the four largest financial institutions in this country are on average 80% larger than they were before we bailed them out” in the financial crisis.

Some commentators have declared that the Democratic race is Sanders' to lose. But several analysts still doubt his chances.

As of Sunday, FiveThirtyEight's projection model ranked the odds of Sanders winning a majority of pledged delegates the same as that of no candidate winning a majority. The latter scenario could result in a contested convention.

“Sanders has a strong base, but one that is hard to expand,” Jaret Seiberg, an analyst at Cowen Washington Research Group, said in a note Thursday. “It is why we still see a moderate winning the nomination, though it is becoming a closer call.”"A new president won’t have the immediate opportunity to change the chair of the FDIC, the Comptroller of the Currency, or the chairman of the Fed, but would have to wait until their terms expired," Naimon said.

To be clear, Sanders isn’t the only progressive Wall Street critic in the Democratic primary. Sen. Elizabeth Warren of Massachusetts has heavily criticized the Trump administration's financial regulators, Wells Fargo and other large banks, and was the architect of the CFPB.

"From my perspective, I think that a lot of the proposals that [Sanders] has put forward … are not entirely dissimilar from the proposals that Sen. Warren has put forward," Naimon said.

But Warren’s rhetoric on the presidential campaign has been viewed as less worrisome for banks.

“Elizabeth Warren reiterated that she’s a capitalist,” the industry source said. “Bernie talks about a revolution and Sen. Warren talks about using government to help those who have been left behind.”

Industry representatives say banks' fears will grow if Sanders becomes president and tries to make his policy proposals a reality.

“I think an outcome that we would be most concerned about ... is that our business models would cease to exist,” the industry source said. “I think the bigger concern is anything else that he does to fundamentally alter this idea of a banking and securities industry that work together and are combined under one entity. … You could do that by massively raising capital requirements for large financial institutions. You could do that through certain Fed rules.”

And it is not just larger financial institutions raising concern about Sanders’ policy positions.

Paul Merski, group executive vice president for congressional relations and strategy for the Independent Community Bankers of America, said many of the policies Sanders supports would likely be detrimental to the sector, although the ICBA will not endorse or oppose any presidential candidates.

   


DATA COLLABORATION WILL LEAD TO A GREATER PIECE OF GLOBAL WEALTH FOR CANADA

G&M - Bilal Khan (2020-02-24)

The value of data in the modern economy is clear – it’s now the single most important asset to four of the five largest companies in the world.


IN RIYADH, TOP CENTRAL BANKERS UNSETTLED BY SHIFTING SANDS OF INFLATION

G&M - LEIKA KIHARA, FRANCESCO CANEPA AND HOWARD SCHNEIDER (2020-02-24)

Central bankers from the United States, Japan and the euro zone meeting in the desert kingdom of Saudi Arabia this weekend had their own shifting sands to cross – those of elusive inflation.


G20 FINANCE HEADS WILL MONITOR IMPACT OF CORONAVIRUS OUTBREAK ON GLOBAL GROWTH, BUT EXPECT MODEST PICKUP IN 2020 AND 2021

G&M - MARWA RASHAD AND FRANCESCO CANEPA (2020-02-24)

Finance chiefs of the world’s top 20 economies vowed to monitor the impact of the coronavirus outbreak on global growth and act if needed, as they said loose monetary policy and easing trade tensions would prompt a pick-up in 2020 and 2021.


NEO EXCHANGE’S DEALSQUARE AIMS TO MAKE PRIVATE EQUITY MORE ACCESSIBLE

G&M - Mark Rendell (2020-02-24)

Launched last October, DealSquare allows securities dealers to list private placements online and distribute shares through NEO’s trading settlement system. The idea is to make it easier for advisers to source private investment opportunities for their clients and to help issuers get their financings in front of more people.


RBC HIKES DIVIDEND AFTER SURPRISE PROFIT INCREASE KICKS OFF BANK EARNINGS SEASON

CBC - CP (2020-02-24)

The bank says it will now pay a quarterly dividend of $1.08 per share, up from its previous payment to shareholders of $1.05 per share.


RBC SEES MORTGAGE STRESS TEST TWEAKS AS HAVING 'MINIMAL IMPACT,' SUPPORTS MORE HOUSING SUPPLY

FP - Geoff Zochodne (2020-02-24)

“Our analysis so far looks like it would be about 25 to 30 basis points reduction in the qualifying rate,” McLaughlin said during a conference call with analysts. “That’ll really translate into a fairly small increase in purchasing power for the average borrower, probably in the neighborhood of about $20,000, $25,000 on an average mortgage.”


AIMCO COULD DO FOR ALBERTA WHAT THE CAISSE IS DOING FOR QUEBEC, BUT MINIMIZING POLITICAL INTERFERENCE IS KEY

FP - Kevin Carmichael (2020-02-24)

“Private equity in Quebec is important for the Caisse,” Emond, who oversees the assets of the Quebec Pension Plan and 40 other provincial funds, told reporters in Montreal on Feb. 20, when CDPQ released its 2019 results.


CANADA'S SHADOW BANKS ARE NOW TOO BIG TO IGNORE

FP - Jeremy Kronick and Wendy Wu (2020-02-24)

Broadly speaking, the shadow sector includes investment funds, private lenders like mortgage finance companies, companies that offer private-label securitization like asset-backed securities, and more. Shadow banks are different from real banks in that they don’t take deposits and make loans. They instead split their operations into different entities. An NBFI might operate a money market mutual fund, for instance, selling shares to investors and using the proceeds to buy money market securities issued by companies that in turn use the money to make various investments, including lending to Canadians.


RBC TO LAUNCH U.S. CONSUMER BANK BETTING ON WEALTHY CLIENTS

Reuters - Nichola Saminather, C Nivedita (2020-02-24)

Royal Bank of Canada plans to open a consumer bank in the United States early next year targeting wealthy clients, with the aim of expanding deposits, its chief financial officer told Reuters on Friday after the bank posted first-quarter profit that beat expectations.


MORGAN STANLEY'S GORMAN CHARTS AMBITIOUS COURSE WITH $13 BILLION E*TRADE DEAL

Reuters - C Nivedita, Elizabeth Dilts Marshall, Michelle Price (2020-02-24)

Morgan Stanley said on Thursday it would buy discount brokerage E*Trade Financial Corp in a stock deal worth about $13 billion, the biggest acquisition by a Wall Street bank since the 2008-2009 financial crisis.


TORONTO AND VANCOUVER NEW HOME PRICES FALL, WHILE MONTREAL SOARS

Better Dwelling - Stephen Punwasi (2020-02-24)

The NHPI for Canada is showing relatively flat movement – and has been stagnating. Prices were flat in January, when compared to a month before. Compared to the same month last year, prices moved just 0.19% higher. Over the past 5 years, the NHPI across Canada has increased 8.27%. This is largely due to price growth stagnation over the past two years.


PHYSICIANS, HOSPITALS MEET THEIR NEW COMPETITOR: INSURER-OWNED CLINICS

WSJ - Anna Wilde Mathews (2020-02-24)

Some of the largest health insurers are steering patients toward clinics they now own as a result of recent massive deals that have given them control over both health-care delivery and payment.


BANK CEOS COURTED BY REGULATOR ON LOW-INCOME LENDING OVERHAUL

WSJ - Andrew Ackerman (2020-02-24)

Joseph Otting, a top U.S. regulator, is personally lobbying bank chiefs to win support for his signature initiative: an overhaul of rules governing hundreds of billions of dollars in lending to low-income areas.


MASS ADOPTION OF AI IN FINANCIAL SERVICES EXPECTED WITHIN TWO YEARS

Forbes - Margaretta Colangelo (2020-02-24)

A significant number of executives from 151 financial institutions in 33 countries say that within the next two years they expect to become mass adopters of AI and expect AI to become an essential business driver across the financial industry. This information was collected as part of a survey on AI in Financial Services conducted by the World Economic Forum in collaboration with the Cambridge Centre for Alternative Finance at the University of Cambridge Judge Business School and supported by EY and Invesco. The objective of the study was to understand the opportunities and challenges that will result from mass adoption of AI in Financial Services. The research was published in a 127-page report entitled Transforming Paradigms A Global AI in Financial Services Survey.


MOBILE PAYMENTS AREN’T ALTERNATIVE PAYMENTS ANYMORE

Forbes - Daniel Doderlein (2020-02-24)

Payments are moving away from the confinements of a piece of hardware and a card. They’re moving to phones, in the form of apps and equally allowing businesses to sell anywhere using digital payment acceptance.


MORGAN STANLEY TO BUY E-TRADE FOR $13B

Benefits Pro - Janet Levaux (2020-02-21)

The news comes three months after Charles Schwab said it was acquiring TD Ameritrade for $26 billion. That merger, now going through antitrust review, would potentially lead to a combined firm with $5 trillion in assets. 


CIBC PLANS TO SHUFFLE EXECUTIVES, CUT 2,000 JOBS AS IT AIMS TO IMPROVE MORTGAGE LENDING, CONTROL EXPENSES

G&M - James Bradshaw (2020-02-21)

Canadian Imperial Bank of Commerce is expected to make major changes to its senior executive ranks and announce about 2,000 jobs cuts when it reports fiscal first-quarter earnings next week, according to sources familiar with the plan.


WHY WALL STREET ISN’T TOO WORRIED ABOUT CORONAVIRUS

G&M - Neil Irwin (2020-02-21)

On Monday evening, Apple warned its shareholders about the effects of the new coronavirus outbreak. Production of iPhones has been slowed because of quarantined workers, and the company expects to sell fewer products in China as the country grapples with the problem.


PENSION GIANT CAISSE TO SELL ONE-THIRD OF ITS MALLS IN CANADA AMID E-COMMERCE HIT

FP - Sandrine Rastello and Paula Sambo (2020-02-21)

Ivanhoe Cambridge held $39.7-billion (US$29.9 bililion) worth of real estate at the end of 2019, about 12 per cent of the total funds under Caisse management. Its shopping centres include the Eaton Centrein Montreal and Metropolis at Metrotown I and II in Burnaby, a suburb of Vancouver.


JOHN O’SULLIVAN: MARK CARNEY, FIDUCIARY RESPONSIBILITY, CHARITY AND OTHER PEOPLE’S MONEY

FP - John O'Sullivan (2020-02-21)

Milton Friedman was an early critic of this kind of thing when he attacked the highly respectable concept of corporate charitable giving. He was misinterpreted, of course, by those who believed (or pretended to believe) that he was advocating a capitalism red in tooth and claw that was contemptuous of compassion and idealism. One critic at the time dismissed his argument as “romantic brutalism.”


OSC PROPOSES MUTUAL FUND RESTRICTIONS TO PROTECT SENIORS FROM LARGE PENALTIES

FP - Barbara Shecter (2020-02-21)

Ontario’s capital markets watchdog is proposing new protections for seniors through restrictions on the sale of mutual funds that carry large penalties if cashed in early, a fee structure that is being banned outright in all other jurisdictions across the country.


WELLS FARGO NEARS ABOUT $3 BILLION DEAL TO END FEDERAL PROBES

Bloomberg - Hannah Levitt (2020-02-21)

Wells Fargo & Co. is poised to pay roughly $3 billion to settle federal investigations into a range of consumer abuses that were rampant at the bank for years, according to a person with direct knowledge of the matter.
The Department of Justice and Securities and Exchange Commission may announce penalties as early as Friday, the person said, asking not to be identified because talks are confidential. The company isn’t expected to plead guilty to a crime, the person said.


INVESTORS IN ‘SHOW ME’ MODE AFTER GROWTH SLIPS AT CANADA’S BANKS

Bloomberg - Divya Balji and Doug Alexander (2020-02-21)

Half of the country’s Big Six banks -- Royal Bank of Canada, Toronto-Dominion Bank and Canadian Imperial Bank of Commerce -- missed expectations for the fiscal fourth quarter, prompting analysts to temper their 2020 forecasts. Concerns about weak economic growth, slower domestic lending, higher loan losses and eroding net interest margins have weighed on banks’ earnings and investors’ minds.

The S&P/TSX Commercial Banks Index has lagged a broader Canadian market measure since last year, with shares of the nation’s eight largest lenders -- which constitute about a fifth of the overall benchmark --- gaining a mere 13% since the end of 2018. That performance lags the S&P/TSX Composite Index’s climb of 25%.

“People are concerned about the economic cycle and banks are cyclical stocks at the end of the day,” Steve Belisle, a senior portfolio manager with Manulife Investment Management, said in a phone interview. Investors “don’t want to introduce too much cyclicality in their portfolio, and I think that’s what has been reflected in the performance of the stocks.”Investors are now in “show-me” mode heading into the banks’ fiscal first-quarter reporting period, as they look to gain comfort that loan losses, which rose last year, won’t get worse, said BofA Securities analysts led by Ebrahim Poonawala.

“While investors are bracing for another year of challenging EPS growth, we believe that the lack of negative surprises and a stable EPS outlook could be enough for stocks to bounce,” the analysts said. Royal Bank, the largest Canadian lender, kicks off the reporting season Friday for the quarter ended Jan. 31.

Some issues that hurt the Canadian banks last year -- higher loan-loss provisions, weak capital markets activity and pressure on net interest margins -- may have eased up in the quarter, Scotia Capital analyst Sumit Malhotra said.

“There’s a case to be made that each of these factors will not be as severe,” Malhotra said in an interview. “In particular, the market-sensitive businesses –- both capital markets and wealth management -- are going to have a good quarter.”

 


CANADA IS MAKING IT EASIER FOR PEOPLE TO TAKE OUT LARGER MORTGAGES

Better Dwelling - Stephen Punwasi (2020-02-21)

The current “stress test” was introduced for insured mortgages just over two years ago. Starting in 2018, insured buyers (those with less than 20% down) are tested at a higher borrowing rate. All insured buyers need to be able to pay the greater of their contract rate plus 200bps, or the Bank of Canada’s benchmark rate. The benchmark rate, as anyone’s that’s shopped for a mortgage knows, was much higher than you would encounter at lenders. This is because it was based on the posted 5-year fixed rate, which is usually only used in calculating some penalties.


CORPORATE CANADA’S ZOMBIE APOCALYPSE

Investment Executive - James Langton (2020-02-21)

In 2018, about 25% of Canadian companies were considered zombies, the Bank found. It also reported that “the share of zombie firms in Canada has been increasing since the mid-1990s.”


DUO BANK ACQUIRING FAIRSTONE FINANCIAL, ITS FIRST MAJOR DEAL SINCE BEING SOLD BY WALMART

G&M - Mark Rendell (2020-02-20)

Duo Bank of Canada is acquiring consumer finance company Fairstone Financial Holdings Inc. for an undisclosed amount of money, marking the bank’s first major deal since it was sold by the retail giant Walmart Inc. to a group of investors in early 2019.


POWER CORP. HAS RESTRUCTURED. NOW, IT JUST NEEDS TO REINVENT ITSELF

G&M - KONRAD YAKABUSKI (2020-02-20)

Minority shareholders in Power Financial Corp. did not exactly strike a blow for corporate democracy in voting Tuesday to exchange their common shares for subordinated voting stock in parent Power Corp. of Canada.


UBS'S TECH-SAVVY NEW BOSS HAMERS NOT ALWAYS LOVED BY THE DUTCH

Reuters - Bart H. Meijer (2020-02-20)

 Ralph Hamers made his mark as a tech-savvy chief executive who led Dutch bank ING (INGA.AS) back to profitability after cementing its position as a no-frills lender in Germany and simplifying its product portfolio.


CLIMATE CAMPAIGNERS TURN THEIR FIRE ON FINANCIAL WORLD

FT - Attracta Mooney, Billy Nauman (2020-02-20)

“BlackRock — murderer.” “Greenwashing kills.” “Our planet. Your crime.”


AXA LOWERS 2020 PROFIT GUIDANCE FOR XL UNIT

Insurance Journal.com - Maya Nikolaeva and Matthieu Protard (2020-02-20)

The French insurer appointed Scott Gunter, previously senior vice president of rival Chubb Ltd, as chief executive of AXA XL. Gunter replaces Greg Hendrick, who was leaving the group, AXA said.


LLOYDS WARNS PROFITABILITY TO FALL AS MORTGAGE COMPETITION INTENSIFIES

FT - Nicholas Megaw (2020-02-20)

Lloyds Banking Group warned that its profitability would drop over the next year, as even the country’s largest high street lenders feel the pressure of competition in the mortgage market.


COINBASE BECOMES VISA PRINCIPAL MEMBER

Finextra - Finextra (2020-02-20)

States the firm: "This membership will enable us to continue to grow the Coinbase Card offering; from additional services to more markets that help to evolve and enrich the cryptocurrency payment experience."


BARCLAYS IN BIG BROTHER BOTHER OVER EMPLOYEE SPYWARE

Finextra - Finextra (2020-02-20)

Installed as a pilot at the product control department within Barclays' investment bank division, the Sapience-supplied Big Brother-style software records employee activity in real-time, compiling daily reports on staff productivity.


REPORT: THE LIBOR SYSTEM DETOUR

Bobsguide - Rebekah Tunstead (2020-02-20)

“When you are modifying code and there are interdependencies, you can do lots of different types of testing but unless you work through the entire process there is always some possibility that there are some interdependencies which you haven’t accounted for. I think you can get a sense of that risk with enough testing, but it can still be a risk.”


CANADIAN EXECUTIVE TO LEAD CENTRAL BANKS’ INNOVATION UNIT

Investment Executive - James Langton (2020-02-20)

Payments Canada’s chief information officer, Andrew McCormack, has been tapped to lead a new fintech unit for the world’s central banks.


BAHAMIAN COURT REJECTS OSC’S BID TO ENFORCE $20M SANCTION

Investment Executive - Greg Dalgetty (2020-02-20)

An OSC panel found that CHCC and Pushka breached their fiduciary duty to the Crown Hill Fund through a variety of improper transactions. Pushka was ordered to pay $18.2 million in disgorgement, $1.875 million in penalties and $300,000 in costs. He unsuccessfully appealed the decision, which was upheld by the Ontario Superior Court of Justice.


SUN LIFE FACES PROPOSED $10M CLASS ACTION

Investment Executive - IE (2020-02-20)

The claim, filed by Connolly Obagi LLP, alleges that Sun Life miscalculated cost-of-living increases in LTD benefits paid to Giulia Belec, an Ontario woman who was employed by the federal government for 37 years until her medical retirement in August 2011.


AN INSIDE LOOK AT FOUR BANKS' EARLY BLOCKCHAIN SUCCESSES AND FAILURES

Business Insider - Mekebeb Tesfaye (2020-02-20)

Despite the hype, sentiment around the technology has grown skeptical...


'SERIOUS DAMAGE': BUSINESSES WARN OF LOOMING LAYOFFS, LOSS OF SALES AS RAIL DISRUPTION DRAGS ON

FP - Jesse Snyder and Julia Mastroianni (2020-02-19)

A coalition of 39 industry associations wrote a letter to Prime Minister Justin Trudeau on Tuesday, calling on him to “work urgently” with First Nations and police to bring the blockade to a peaceful end.


HUAWEI ACCUSES U.S. OF OVERLOOKING HSBC MISCONDUCT TO GO AFTER CHINESE FIRM

Reuters - Karen Freifeld (2020-02-19)

U.S. prosecutors overlooked apparent violations of U.S. sanctions against Iran by HSBC Holdings in exchange for the British bank’s cooperation with a government investigation of Huawei Technologies, lawyers for the Chinese telecoms giant said.


TRUMP PARDONS MILKEN, COMMUTES BLAGOJEVICH SENTENCE

WSJ - Byron Tau (2020-02-19)


CANADIAN REAL ESTATE PRICES ARE CLIMBING AT THE FASTEST PACE IN ALMOST 2 YEARS

Better Dwelling - Kaitlin Last (2020-02-19)

The largest price increases were in Ontario and Quebec. Ottawa’s benchmark, a.k.a. typical home price, reached $459,100 in January, up 13.53% from last year. Montreal made the second biggest annual climb with the benchmark hitting $387,000, up 9.74% from a year before. Niagara comes in third with a benchmark of $440,900, up 9.52% from last year. Both Ottawa and Montreal have seen about half the growth Toronto and Vancouver have seen over the past 5 years.


RRSP CONTRIBUTIONS ARE UP, BUT THEIR POPULARITY WITH TAXPAYERS IS DOWN

IE - James Langton (2020-02-19)

The number of taxpayers that made RRSP contributions rose in 2018, but the proportion of taxpayers that made contributions declined, according to new data from Statistics Canada.


CORPORATE LEVERAGE AT RECORD HIGH: OECD

IE - James Langton (2020-02-19)

The quantity of corporate debt hit record levels at the end of 2019, and the quality of that debt has declined, says the Organization for Economic Cooperation and Development (OECD).


THE BANK OF CANADA’S PLANS FOR CORRA

IE - James Langton (2020-02-19)

The central bank, which is taking over as administrator of the interest rate benchmark from Refinitiv Benchmark Services (UK) Ltd., will start providing the benchmark for free on its website on June 15.


BANK OF CANADA TO BEGIN PUBLISHING CANADIAN OVERNIGHT REPO RATE AVERAGE IN JUNE

BOC - Press Release (2020-02-19)

The Bank of Canada will take over the responsibility for publishing the Canadian Overnight Repo Rate Average (CORRA), effective Monday, June 15, 2020.


GOLD PRICE JUMPS TO NEAR 7-YEAR HIGH

Mining.com - Frik Els (2020-02-19)

The gold price jumped to a fresh near 7-year high on Tuesday as worries about the global economic impact of the coronavirus mutated into expectations of massive monetary stimulus to counteract the damage done in China and elsewhere.


BLOOMBERG TACKS LEFT ON FINANCIAL REGULATION. SHOULD BANKS BE WORRIED?

American Banker - Neil Haggerty (2020-02-19)

The former New York City mayor surprised many in the industry with a comprehensive financial policy plan that would reinstate post-crisis rules that have been weakened or eliminated in the Trump administration, but would also enact additional reforms that echo the platforms of Elizabeth Warren and even Bernie Sanders.


ALLY AGREES $2.65BN CARDWORKS ACQUISITION

Finextra - Finextra (2020-02-19)

Ally will pay $1.35 billion in cash and $1.3 billion in stock for CardWorks, a non-prime credit card and consumer finance lender with $4.7 billion in assets and $2.9 billion in deposits.


CONSUMERS FACE DELAYS, COMPLICATIONS WHEN ESCALATING COMPLAINTS AGAINST BIG SIX BANKS, WATCHDOG SAYS

G&M - Clare O'Hara (2020-02-19)

Canada’s financial consumer watchdog says customers of the Big Six banks are being hit with delays and complications when they try to escalate complaints and most simply give up.


NINE THINGS MORTGAGE SHOPPERS SHOULD KNOW ABOUT THE STRESS-TEST CHANGES

G&M - Robert Mclister (2020-02-19)

Policy-makers are finally righting a glaring wrong in the mortgage market.


VIA RAIL ISSUES TEMPORARY LAYOFFS TO NEARLY 1,000 WORKERS AS BLOCKADES CONTINUE

CBC - CBC (2020-02-19)

Those rail shutdown have drastically reduced Via's ability to continue its service, so the network has been stripped down to a shadow of its former self while the protests go on. 


WHY MORTGAGE STRESS TEST CHANGES SHOULD NOT BE MADE IN POLITICAL BACKROOMS

FP - Kevin Carmichael (2020-02-19)

Why? Rita Trichur, one of the better chroniclers of Bay Street, offered a plausible answer. “If you’re wondering why OSFI is suddenly considering fiddling with the stress test as froth builds in the Vancouver and Toronto housing markets, household debt remains high and consumer insolvencies are rising, look no further than Prime Minister Justin Trudeau and his waning political fortunes,” she said in the Globe and Mail on Feb. 13.


NEXT FINANCIAL CRISIS – STOCKS, CURRENCY OR BONDS?

Armstrongeconomics - Martin Armstrong (2020-02-19)

The volatility that surrounds a financial crisis depends upon the origin of the sector. When there is a crisis in confidence in the private sector, corporations or banks, the capital shifts and sells private assets and runs into government securities (bonds/notes), which we call the “Flight to Quality” that typically is used only in this context.


OTTAWA UNVEILS NEW MORTGAGE STRESS-TEST RULES THAT WILL MAKE IT EASIER TO QUALIFY

G&M - James Bradshaw, Rachelle Younglai (2020-02-19)

Finance Minister Bill Morneau announced Tuesday that a key benchmark rate set by the Bank of Canada will be replaced by a new rate when calculating stress tests for insured mortgages, which have a down payment of less than 20 per cent of the purchase price.


JUST WHEN THE HOUSING MARKET NEEDS A FIRM HAND, OTTAWA MAKES IT EASIER TO GET A MORTGAGE

G&M - Rob Carrick (2020-02-19)

Starting April 6, the stress test will get easier for insured mortgages, which typically means the buyer has a down payment of less than 20 per cent. An already hot market in many cities is getting more stimulus through the easier stress test. Prices will rise, affordability will fall and more people will buy homes they can just barely afford. Wait until they add kids, cars and rooms full of furnishings.


HOW TORONTO’S AIRBNB RULES COULD SHAKE UP THE RENTAL MARKET

G&M - Matt Lundy (2020-02-19)

For years, Danny Jellis has made a mint off of Airbnb.


CLYDE & CO CONFIRMS NUMBER OF INSURANCE DEALS WORLDWIDE IN 2019

Insurance Business - Ryan Smith (2020-02-18)

The volume of mergers and acquisitions in the insurance space rose 10% in 2019, according to insurance law firm Clyde & Co. A study by the firm found that 419 deals were completed worldwide last year, up from 382 in 2018.


MANITOBA TO REIMBURSE MUNICIPALITIES FOR APPROVED FLOOD RESILIENCE PROJECTS

Insurance Business - Lyle Adriano (2020-02-18)

Under the $3 million program, each city project is eligible to receive as much as $150,000, while projects from the city of Winnipeg can get back as much as $500,000.


HSBC TO SLASH INVESTMENT BANK, 35,000 JOBS IN STRATEGY OVERHAUL

Reuters - Sumeet Chatterjee, Lawrence White (2020-02-18)

HSBC Holdings PLC (HSBA.L) said on Tuesday it would shed $100 billion in assets, shrink its investment bank and revamp its U.S. and European businesses in a drastic overhaul that will mean 35,000 jobs cut over three years.


HSBC IS NO MAN'S LAND FOR QUINN OR ANYONE ELSE

Bloomberg - Nisha Gopalan (2020-02-18)

HSBC Holdings Plc is embarking on a radical overhaul while it continues the hunt for a permanent chief executive. For investors, the strategic muddle of this bizarre situation should be at least as troubling as the stinging cuts, $7.3 billion of charges and suspension of buybacks that the bank announced with its earnings Tuesday.


IS THIS THE NEXT LEADER OF THE FED?

NY Times - Lucy Steinzova (2020-02-18)

Ms. Shelton has questioned whether America needs the Fed at all.


CAISSE BOOSTS CIRQUE DU SOLEIL STAKE WITH DEAL TO BUY OUT FOUNDER

G&M - Nicolas Van Praet (2020-02-17)

Caisse de dépôt et placement du Québec is increasing its bet on Cirque du Soleil by buying out the founder of the famed circus troupe.


BOMBARDIER FORMALLY ANNOUNCES SALE OF RAIL UNIT TO FRANCE’S ALSTOM

G&M - CP (2020-02-17)

Bombardier Inc. says it has reached a US$8.2-billion deal to sell its rail business to French train giant Alstom SA.


CRA SEEKS TO RECOVER HUNDREDS OF MILLIONS IN CHARITY TAX ‘SHAM’

G&M - Patrick Brethour (2020-02-17)

In one of the biggest tax scams in Canadian history, tens of thousands of Canadians claimed more than $500-million in illegitimate tax refunds over a decade based on bogus charitable donations, newly released figures from the Canada Revenue Agency show.


JAPAN ON BRINK OF RECESSION AS ECONOMY CONTRACTS, VIRUS HEIGHTENS RISK

G&M - LEIKA KIHARA AND DANIEL LEUSSINK (2020-02-17)

“There’s a pretty good chance the economy will suffer another contraction in January-March. The virus will mainly hit inbound tourism and exports, but could also weigh on domestic consumption quite a lot,” said Taro Saito, executive research fellow at NLI Research Institute.


FURNITURE RETAILER PIER 1 IMPORTS CLOSING ALL CANADIAN STORES, FILING FOR BANKRUPTCY PROTECTION

G&M - Reuters (2020-02-17)

Home decor and furniture retailer Pier 1 Imports Inc on Monday said it had filed for bankruptcy protection and was pursuing a sale, a month after it warned of its ability to continue as a going concern in a tough retail environment.


OTTAWA NEEDS TO REBOOT INFRASTRUCTURE BANK, OR SHUT IT DOWN

G&M - Andrew Willis (2020-02-17)

The federal Liberals are mulling a reboot of the Canada Infrastructure Bank over frustrations with what the government perceives as a failure to execute at the $35-billion investment fund.


MORTGAGES THAT PAY YOU AND SAVINGS ACCOUNTS THAT DON'T — THE NEW RULES OF LOW RATES

CBC - AP (2020-02-17)

The latest chapter is the drop in interest rates on some bank deposits below zero as central banks, particularly in Europe and Japan, try to support the economy amid uncertainty about trade by making borrowing cheaper to spur spending and investment. Official data released Friday showed that Germany's growth ground to a halt at the end of last year.


EQUITABLE LIFE REPORTS RECORD EARNINGS FOR 2019

Insurance-Portal.ca - Kate McCaffrey (2020-02-17)

 


IGM FINANCIAL’S NET EARNINGS RISE IN Q4

Insurance-Portal.ca - IIJ (2020-02-17)

  IGM Financial’s fourth quarter net earnings were $191.6-million, up from $179.9-million in the fourth quarter of 2018. Annual net earnings, however, were down slightly compared to the year prior. IGM Financial’s annual net earnings reached $746.7-million for 2019, down slightly from $767.3-million reported in 2018. Adjusted net earnings for the year were


THERE’S A WALL OF CASH EAGER TO BUY TREASURIES ON ANY PRICE DIP

Bloomberg - Liz McCormick and Ruth Carson (2020-02-17)

Investors overseeing trillions of dollars are plowing money into U.S. government debt like never before, in a wave that’s only gaining strength as the spreading coronavirus casts doubt on the global growth outlook.

Evidence of the insatiable demand can be found across the fixed-income universe. Pensions, which have been ramping up bond allocations for more than a decade after a change in regulations, now hold a record amount of longer-dated Treasuries. Bond mutual funds saw a historic inflow of money last year, with no sign of a slowdown. Even hedge funds have piled in.

The wall of cash is a boon to American taxpayers as the federal deficit swells. It’s keeping Treasury yields, a benchmark for global borrowing, near all-time lows. With buyers ready to pounce, even surging stocks, record auction sizes and the tightest labor market since the 1960s can barely make a dent in bond prices.


LEBANON WARNED OF IMPLOSION AS IMF, WORLD BANK PLEAD FOR REFORMS

Bloomberg - Farah Elbahrawy and Abeer Abu Omar (2020-02-17)

Lebanon is at risk of “implosion” unless it develops a new governance model that’s less corrupt and more transparent than today’s system, according to the World Bank.

“Politicians need to stop and listen,” Ferid Belhaj, the World Bank’s most senior official for the Middle East and North Africa, said in an interview in Dubai on Sunday. “You cannot continue doing what you’ve been doing for years when you see what the reaction on the street is and when you see what the state of the economy is.”

Lebanon has been wracked by protests since October, which forced then-Prime Minister Saad Hariri to step down, over worsening economic conditions and government mismanagement. The new administration of Premier Hassan Diab has asked the International Monetary Fund for technical help, including over how it should handle one of the world’s largest debt loads.The government’s debt stands at more than 150% of gross domestic output and foreign investors have all but priced in a sovereign default. Most of Lebanon’s Eurobonds trade below 35 cents on the dollar and politicians are still deciding whether to repay $1.2 billion of notes maturing on March 9. The price of the bonds has plunged to 74 cents from 90 cents in early February.


ARGENTINA’S CREDITORS FEAR THE WORST AFTER IMF TALKS BEGIN

FT - Benetict Mandar (2020-02-17)

As Argentina attempts to win the IMF’s support for a $100bn debt restructuring, the sabre-rattling of the leftist government is stoking fears among creditors of a messy default.


INSIDE THE BONDFIELD INVESTIGATION: HUNDREDS OF THOUSANDS IN CASH DEPOSITS FLOWED INTO ACCOUNT, RECORDS REVEAL

G&M - Karen Howlett (2020-02-13)

It happened over and over again: cash deposits flowing into a bank account linked to Bondfield Construction Co. Ltd., one of Ontario’s largest builders of public-sector projects. The bank account that took in the $630,000 in cash deposits is at the centre of the probe. The monitor alleges that the account at the Woodbridge, Ont., branch of Italian Canadian Savings & Credit Union, known as IC Savings, was a vehicle for many of the suspect transactions.


MANULIFE BOOSTING DIVIDEND 12 PER CENT ON HIGHER PROFITS IN FOURTH-QUARTER AND FULL YEAR

G&M - CP (2020-02-13)

Manulife Financial Corp. is boosting its quarterly dividend 12 per cent after it capped a stronger 2019 with net earnings more than doubling in the fourth quarter.


SUN LIFE FINANCIAL FOURTH-QUARTER PROFITS SURGE 24 PER CENT TO $719-MILLION

G&M - CP (2020-02-13)

Sun Life Financial met expectations as its net income surged 24 per cent to $719 million in the fourth quarter.


CANADA'S BIG BANKS ARE GOING GREEN — BUT THEY’RE LENDING MORE AND MORE MONEY TO THE OIL INDUSTRY

FP - Doug Alexander and Kevin Orland (2020-02-13)

The six largest lenders had $58.8 billion (US$44.2 billion) in energy loans on their books at the end of the fiscal year, a 59 per cent jump from five years ago, even after touting billions of dollars in climate-friendly commitments. There’s little sign of that trend abating even as oil and gas companies face increasing scrutiny over the the roles they play in climate change.


FP DEALMAKERS: FOREIGN FIRMS GOBBLED UP RECORD NUMBER OF CANADIAN COMPANIES IN 2019

FP - Yadullah Hussain (2020-02-13)

Financial Post Data shows international firms acquired 247 Canadian companies last year for a combined value of $59.6 billion — it is at least a 10-year record both in terms of number and value of deals, according to our research.


BARCLAYS CHIEF STALEY PROBED OVER EPSTEIN TIES

Reuters - Lawrence White, Iain Withers (2020-02-13)

The probe is the second regulatory investigation into Staley’s conduct in recent years, after the FCA and PRA fined him 642,000 pounds in 2018 for trying to identify a whistleblower who sent letters criticizing a Barclays employee.


WELLS FARGO ENDS FORCED ARBITRATION FOR SEXUAL HARASSMENT CLAIMS

Reuters - Imani Moise (2020-02-13)

“Wells Fargo has raised the bar for financial institutions aiming to root out sexual harassment in the workplace,” said Clean Yield’s Director of Shareholder Advocacy, Molly Betournay. “We urge other companies, particularly other big banks, to follow suit.”


COMMERZBANK IS READY TO DROP MBANK SALE UNLESS PRICE IS RIGHT

Bloomberg - Steven Arons (2020-02-13)

Chief Executive Officer Martin Zielke in September announced his plan to sell the Polish lender, largely to fund his four-year, 1.6 billion-euro ($1.7 billion) restructuring effort. The sale is expected to take 17 billion euros of assets weighted for risk off the Commerzbank’s balance sheet and thus boost its capital buffers.


VANCOUVER CONSUMER INSOLVENCIES RISE OVER 10%

Better Dwelling - Daniel Wong (2020-02-13)

Greater Vancouver has generally seen substantial growth. There were 5,089 insolvency filings made in 2019, up 10.1% from a year before. Bankruptcies represent 1,643 of those filings, down 0.2% from a year before. Consumer proposals represent the other 3,446 filings, up a whopping 15.8% from a year before. Growth was higher in Q4 than the annual average, possibly indicating acceleration.


TORONTO HOUSEHOLDS ARE GOING BROKE – FAST. INSOLVENCIES RISE 18%

Better Dwelling - Daniel Wong (2020-02-13)

Greater Toronto insolvencies were climbing quickly at the end of last year. There were 4,385 insolvency filings in Q4 2019, up 19% from a year before. Breaking it down, bankruptcies represent 1,114 of the filings, up 3.1% from last year. Consumer proposals represent the other 3,271 filings, up 25.6% from a year before. Both segments are seeing substantial growth, but consumer proposals are soaring.


INS AND OUTS OF TRAVEL INSURANCE AMID CORONAVIRUS OUTBREAK

Canadian Underwriter - CP (2020-02-13)

As soon as the Canadian government declares a Level 3 or 4 travel advisory, a person may cancel their upcoming trip and their insurance should cover any lost expenses, said Weir.


CANADIAN TIRE EXPANDING IN-STORE PICKUP PROGRAM TO SUPPORT GROWING E-COMMERCE EFFORTS

G&M - SUSAN KRASHINSKY ROBERTSON (2020-02-13)

Canadian Tire Corp. Ltd. will roll out lockers for online order pick-ups at hundreds of its stores in the coming year, as the company works to convince online shoppers to visit its stores.


ROBO-ADVISERS BEAT THESE HUMAN ADVISERS – SORRY, SALESPEOPLE – ANY DAY

G&M - Rob Carrick (2020-02-13)

Robo-advisers are struggling to find customers and one explanation is that people prefer the human touch when getting financial help.


'THE DISMANTLING OF BOMBARDIER': COMPANY ABANDONS COMMERCIAL AEROSPACE, EYES FOCUS ON PRIVATE JETS AS SALE OF TRAIN UNIT SAID TO LOOM

FP - Emily Jackson (2020-02-13)

Bombardier Inc. officially abandoned its multi-billion dollar dream to compete in commercial aerospace and is reportedly nearing a deal to sell off its troubled rail division, meaning the business jet division could soon be all that’s left of the storied Quebec plane and train manufacturer that’s shedding assets to pay off debt.


NATIONAL BANK UNFAZED AFTER EU HITS KEY GROWTH MARKET CAMBODIA WITH SANCTIONS OVER HUMAN RIGHTS

FP - Geoff Zochodne (2020-02-13)

Montreal-based National owns Cambodia’s Advanced Bank of Asia Ltd., or ABA, which has more than 75 branches, 350 ATMs and hundreds of thousands of customers in the country of 16 million.


JPMORGAN SETS JULY DEADLINE FOR FINTECHS TO SIGN NEW DATA ACCESS DEALS: SOURCES

Reuters - Pete Schroeder, Anna Irrera (2020-02-13)

 JPMorgan Chase & Co (JPM.N) has told financial technology companies they will be barred from accessing its customer information by July 30 unless they sign data access agreements with the bank and back a plan to stop using customer passwords to gather the data.


U.S. ACCUSES HUAWEI OF STEALING TRADE SECRETS, ASSISTING IRAN

Reuters - Karen Freifeld (2020-02-13)

U.S. prosecutors on Thursday accused Huawei of stealing trade secrets and helping Iran track protesters in its latest indictment against the Chinese company, escalating the U.S. battle with the world’s largest telecommunications equipment maker.


PIPELINE PROTESTS CRIPPLE CANADIAN RAILWAYS, RAISING CEOS’ IRE

Bloomberg - Divya Balji, Michael Bellusci, and Robert Tuttle (2020-02-13)

Protests against a natural gas pipeline are crippling Canada’s railways -- key economic arteries in the sprawling, trade-dependent nation -- and prompting cries of “insanity” and “ecoterrorism” from business leaders.
Canadian National Railway Co., the country’s largest rail provider, has canceled 400 trains in the past week and said on Thursday that it will shut down its operations in Eastern Canada, possibly leading to temporary layoffs. Via Rail, which operates passenger train service across the nation, is canceling all services effective immediately.
The cancellations mark the most severe fallout yet from protests that have spread across Canada in recent days, disrupting shipments of oil, grain, propane, lumber and consumer goods. Environmental and indigenous-rights activists are blockading rail lines, ports and other infrastructure to show solidarity with portions of the Wet’suwet’en Nation that are protesting construction of TC Energy Corp.’s planned C$6.6 billion ($5 billion) Coastal GasLink pipeline through their territory in British Columbia.


TD MARKETS FIRST RMBS FROM A TOP-SIX CANADIAN BANK

Bloomberg - Esteban Duarte (2020-02-13)

The transaction will be backed by a C$688.3 million ($517 million) pool of home loans that were originated by three smaller lenders, according to a DBRS Morningstar document. TD Securities plans to offer C$450 million of top-rated securities with an expected maturity around Feb. 2023, according to people familiar with the matter who asked not to be named. It will be a milestone in creating a market to help disperse housing debt risk.


UK REGULATORS OPENED STALEY PROBE AFTER RECEIVING JPMORGAN EMAILS

FT - David Crow, Stephen Morris and Caroline Binham (2020-02-13)

UK regulators opened an investigation into the links between Barclays chief executive Jes Staley and disgraced financier Jeffrey Epstein after receiving a cache of emails supplied by JPMorgan Chase.


AIG’S OUTLOOK AND REVAMPED COST-SAVING PLAN FAIL TO IMPRESS

FT - Robert Armstrong (2020-02-13)

Investors were unimpressed with AIG’s outlook for 2020 and a new savings target for its cost-saving programme, and sending shares in the US insurer down by 3.6 per cent in mid-day trading after the company reported fourth-quarter earnings.


GREAT-WEST LIFECO’S POSTS LOWER EARNINGS

Insurance-Portal.ca - Kate McCaffrey (2020-02-13)

Great-West Lifeco Inc. released its fourth quarter and 2019 earnings Feb. 12, reporting net earnings attributable to common shareholders of $513-million, down from the $710-million reported for the same quarter in 2018.


POWER CORP. HAS RESTRUCTURED. NOW, IT JUST NEEDS TO REINVENT ITSELF

G&M - KONRAD YAKABUSKI (2020-02-12)

Minority shareholders in Power Financial Corp. did not exactly strike a blow for corporate democracy in voting Tuesday to exchange their common shares for subordinated voting stock in parent Power Corp. of Canada.


ALBERTA TO LOSE $1.3-BILLION IN SALE OF OIL-BY-RAIL CONTRACTS

G&M - James Keller (2020-02-12)

Premier Jason Kenney said Alberta will lose $1.3-billion from the sale of oil-by-rail contracts signed by his predecessor as he announced that his government had agreements to offload them onto the private sector.


WHAT KIND OF MODERNIZATION DOES THE SECURITIES ACT REALLY NEED?

G&M - Ian Russell (2020-02-12)

A statutory obligation demands that the Ontario Securities Act be reviewed every five years. It’s a sound policy, but unfortunately the last review took place approximately 16 years ago, in 2003.


WHAT'S IN THE BLACK BOX? RISE OF ARTIFICIAL INTELLIGENCE IN BANKING PRESENTS CHALLENGE FOR OSFI

FP - Geoff Zochodne (2020-02-12)

“AI presents challenges of transparency and explainability, auditability, bias, data quality, representativeness and ongoing data governance,” OSFI Assistant Superintendent Jamey Hubbs said last month in a speech, according to a transcript. “There may also be risks that are not fully understood and limited time would be available to respond if those risks materialize.”


BIGGEST RISK TO CMHC’S MORTGAGE INSURANCE BUSINESS IS SLOW-BUILDING ECONOMIC CRISIS: REPORT WARNS

FP - Geoff Zochodne (2020-02-12)

However, “a slowly developing economic scenario, like 5/30, represents the greatest threat to the financial condition” to CMHC’s business, the report suggests, since it could drive its mortgage insurer capital adequacy ratio below an industry-wide target set by the Office of the Superintendent of Financial Institutions.


SOURING ENERGY LOANS WIPE OUT ABN AMRO'S PROFIT GROWTH

Reuters - Bart H. Meijer (2020-02-12)

Shares in the Dutch bank fell 5.6% by 1005 GMT, the biggest loser by far on Amsterdam’s blue-chip AEX index, after ABN said net profits were flat in the last quarter of 2019 at 316 million euros ($345 million). That widely missed analysts’ expectations of a rise from a year earlier to 429 million euros.


WELLS FARGO CEO SCHARF SHAKES UP MANAGEMENT AT SCANDAL-HIT BANK

Reuters - Imani Moise, Abhishek Manikandan (2020-02-12)

The shakeup is aimed at putting a new structure in place as the bank looks to rebuild its reputation and increase accountability, Wells Fargo said in a statement.


JAPAN'S MUFG, MIZUHO IN LONDON REHIRING SPREE DESPITE BREXIT

Reuters - Lawrence White, Sinead Cruise (2020-02-12)

Mizuho has hired more than 25 senior bankers and traders, while MUFG has hired seven senior investment bankers, an aviation finance team from Germany’s DVB Bank and dozens of back office risk and compliance staff, information from sources and internal bank memos seen by Reuters show.


BOND SELLERS IN CANADA PILE IN AMID MORNEAU VIRUS WARNING

Bloomberg - Estaban Duarte (2020-02-12)

Finance Minister Bill Morneau gave a gloomy assessment related to the spreading coronavirus.


UBER MONEY BOLSTERS TEAM IN INDIA

Finextra - Finextra (2020-02-12)

"Besides engineering, we are investing in growing and scaling data science, analytics, and product management organisations to transform Hyderabad into a full spectrum tech site for Uber."


THINGS ARE FALLING APART FOR EUROPE’S SINGLE CURRENCY

Bloomberg - John Authers (2020-02-12)

2020 was supposed to be the year when Europe began to shine. After suffering the decision by the U.K. to leave, the European Union had the chance to move forward with greater certainty. The easing of the U.S.-China trade war would aid recovery after a slump in manufacturing that appeared to be ending. And the euro could start to strengthen against the dollar, in a consummation devoutly wished in the capitals of Europe and the U.S. 


LEVERAGED LOANS TAKE CENTER STAGE IN UPCOMING STRESS TESTS

American Banker - Jim Dobbs (2020-02-12)

Leveraged lending is the boogeyman lurking in the latest round of stress testing for large banks.


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UBS WEALTH BANKERS GET DOSE OF CREDIT SUISSE TONIC IN KHAN PLA

Bloomberg - Patrick Winters and Marion Halftermeyer (2020-12-17)

Colleagues say the Pakistan-born executive is enthusiastic, energetic and talented. Former associates have described him as confident, even overly so. That said, he knows the business from several angles: Khan was a UBS auditor at Ernst & Young and a key competitor at Credit Suisse.


HOW CAN INSURANCE BROKERS USE RATE COMPARISON SITES TO BOOST THEIR BOOKS OF BUSINESS?

Insurance Business - Bethan Moorcraft (2020-12-07)

Enter, rate comparison websites. They’re all the rage in the UK and the USA, where consumers use comparison sites to shop for insurance much like Canadians do when comparing travel costs on sites like Expedia and Trivago. But Canadians are slowly starting to catch on to the insurance comparison trend. They’re searching for and finding platforms like LowestRates.ca, which is enabling consumers to compare insurance premium prices across a number of product lines, primarily in auto and home insurance.


BOAZ MANOR, BUSINESS PARTNER INDICTED ON FRAUD CHARGES IN U.S. OVER BLOCKCHAIN VENTURE

FP - Barbara Shecter (2020-10-20)

Boaz Manor, a former Canadian hedge fund manager who served jail time following the collapse of Portus Alternative Asset Management Inc. in 2005, was indicted Friday on fresh criminal charges in the United States in connection with an alleged securities fraud scheme at an entirely different venture: a New York-based blockchain technology startup.


CHRISTINE LAGARDE GETS A HEAVY POINTER ON HER ECB REVIEW

Bloomberg - Ferdinando Giugliano (2020-06-20)

Nevertheless, Lagarde and her colleagues would be wise to read the staff paper closely. Among all the carefully worded language, one can clearly see the contours of a monetary framework that would work for the ECB’s third decade. These include changing the inflation target to 2%, and maintaining all of the instruments — asset purchases, long-term loans to the banking system and negative interest rates — that the central bank used throughout the presidency of Lagarde’s predecessor, Mario Draghi. 

The argument for a symmetric inflation target is rooted in the power of expectations. The ECB at the moment aims to reach an inflation rate “close to but below 2%.” This means that, as price pressures start climbing toward 2%, investors and consumers expect the ECB to react aggressively, tightening monetary policy to push inflation back. The authors believe this served the ECB well during its first decade, when it had to establish its reputation and fight off inflationary forces. However, the objective has been less useful in today’s era of persistently low inflation. It may even be counterproductive. Consumers and investors don’t expect the central bank to act so decisively to counter deflation.  


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CIBC POSTS PROFIT GAIN, HIKES DIVIDEND AS BANK SHUFFLES EXECUTIVE RANKS, BOOKS RESTRUCTURING CHARGE

Canadian Imperial Bank of Commerce increased quarterly profit by 3 per cent and raised its dividend, but also shuffled its executive ranks and took a $339-million restructuring charge.

The charge is mostly made up of severance costs after chief executive officer Victor Dodig told staff to expect layoffs in an internal memo last month. But the restructuring reaches the bank’s highest ranks, with the appointment of a new head of retail banking and a new chief risk officer, as The Globe and Mail previously reported.

Canada's fifth-largest bank reported profit of $1.21-billion, or $2.63 per share, compared with $1.18-billion, or $2.60 a share, in the same quarter last year.

After adjusting for the restructuring charge, which will cost the bank $250-million after tax, and for other items, CIBC said profit rose 9 per cent to $1.48-billion, or $3.24 per share. Analysts expected adjusted earnings per share of $3.00, according to Refinitiv.

The bank raised its quarterly dividend by two cents to $1.46 per share.

 

Laura Dottori-Attanasio, who has been the bank's chief risk officer, is the new head of personal and business banking, taking charge of its core retail banking operations. She succeeds Christina Kramer, who is moving to a new role as head of technology, infrastructure and innovation, as current head of technology and operations Kevin Patterson prepares to retire on May 1.

Shawn Beber, the bank's general counsel and head of corporate development, will be the new chief risk officer, and keeps his current duties on an interim basis.


WALMART IN TALKS WITH THIRD PARTIES OVER INVESTMENT IN U.K. ARM ASDA

Walmart, the world’s largest retailer, is in talks with possible buyers of a stake in its British supermarket Asda, which it failed to combine with Sainsbury’s last year.

Asda and Walmart said in a joint statement on Wednesday that discussions with “a small number” of suitors followed “inbound interest” but no decisions had been taken.

In common with its traditional big four British rivals – market leader Tesco, Sainsbury’s and Morrisons – Asda has been losing market share to German-owned discounters Aldi and Lidl, which are still opening lots of new stores.

That has put pressure on Asda, which said last week that budget-conscious British consumers were behind a fall in underlying sales in the key Christmas quarter.

“We are currently considering whether there is an opportunity for a third party to invest in Asda, alongside Walmart, in order to support and accelerate the delivery of Asda’s strategy and position Asda for long term success,” Walmart and Asda said in a joint statement.

The potential buyers share Walmart and Asda’s commitment to growing the British business, they added.
Walmart would likely retain a significant minority stake in Asda in any deal, a person with knowledge of the matter said.


AIRLINES SLASH COSTS AS CORONAVIRUS CRISIS DEEPENS

Airlines rattled by the coronavirus rushed to cut costs on Wednesday, as warnings of a pandemic deepened concern about the scale of the impact on aviation and other front-line sectors.

Austerity measures ordered by Germany’s Lufthansa and Amsterdam-based KLM include unpaid staff leave and hiring freezes, while Virgin Australia dropped seven planes from its fleet and said pilot redundancies were likely.

“We urge you all to reduce your cost levels to a minimum level to ensure safe operations,” KLM chief financial officer Erik Swelheim wrote in a message to executives first reported by Dutch news agency ANP. “Only ‘must-do’ expenditure is allowed.”

The “very significant” revenue impact of the crisis will be only partly offset by lower fuel and other costs, Mr. Swelheim added in the letter, released later by the carrier.

Parent company Air France-KLM did not immediately respond to questions about the repercussions for Air France or the rest of the Franco-Dutch airline group.

Airlines are flying blind into a crisis of unknown severity and duration. The outlook is worsening as new outbreaks spread fear beyond the Asian destinations already suspended – threatening more routes as well as broader air travel demand.
“It’s quite clear that there’s a risk of what is still termed a localized epidemic becoming a pandemic,” said aviation analyst Mark Simpson of Dublin-based brokerage Goodbody.



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