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Recap of recent real estate news in Canada. Tiff Macklem and market exuberance, cottage country price appreciation and the rise of lumber prices.


Bulls versus the bears, this week in the Canadian real estate industry.


We a living a ponzi real estate market and the economy is at risk. Yet Doug Porter, economist BMO, is on record as saying Candian\'s want to pay more for houses. Yes, you can\'t make this stuff up. This video discusses the issues related to Porter\'s statement and explains why he is wrong.


2020 was a record year, except for condos. Montreal REM sites the exception to this rule. This video shares insights regarding the Canadian real estate segment.


Taxes are going up, TO condo prices are going down and recreational property up 15% to 40% in the Canadian market.


The mortgage debt to income ratio declined despite the pandemic. In this issue I discuss real estate stalling and immigration's impact on home prices.


This video is intended to give viewers an understanding of the economic ideas behind Canada's potential housing bubble. This video also explains why Siddal, President and CEO of the CMHC, was likely pushed from his post.


October 14th real estate report describing the issues in the market the last two weeks.


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.


'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.


Canadian banks have increased their deposits by $127 billion since the start of the pandemic. This video uses charts to show which banks gained the most and how.


About

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

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Research

Real estate report: October 30th, 2020  

fsim.ca/docs/Oct30rereportv1.pdf

Mark Sibthorpe

The big buzz in real estate recently is Mark Carney being scooped up by Brookfield. This means more juice for riskier borrowers. Brookfield, a huge player in real estate, both residential and commercial, recently bought its remaining shares from Sagen (Genworth MI Canada), which values the company at $3.8 bn.


VersaBank’s New High-Security VPN Proving Especially Valuable During COVID-19 Pandemic  

fsim.ca/docs/TailscaleReleaseMarch30FINAL.pdf

Press Release

VersaBank (TSX:VB) (“VB” or the “Bank”) today announced the implementation of its new high security Virtual Private Network (VPN) remote access software solution, developed in partnership with Tailscale, a leading provider of secure network connectivity solutions. The software enables VersaBank employees to securely and directly connect to all the Bank’s servers across multiple offices and cloud providers, using two factor authentication and with every connection encrypted. The Tailscale-based solution uses the Office 365 setup and Windows client/server applications that the Bank already had in place.


2014 FSIM when Bernanke visited Montreal  

fsim.ca/docs/MockBernanke.pdf

Mark Sibthorpe

Considering Bernanke is hated by the Republicans and hated even more by the Democrats, and is currently under scrutiny for saving AIG but not Lehman, (in hindsight) with respect to issues over solvency vs liquidity, the Montreal lovefest attended by 1,100 people yesterday must have been a welcome respite. Click the link to read the entire 2014 report.


Eisman's big Canadian bank short  

fsim.ca/docs/eisman2.pdf

Mark Sibthorpe

I have been reporting on Steve Eisman's short position for quite some time.  As the analyst reaction to Eisman shows (link below), Eisman has taken a lot of heat for shorting Canadian banks. Instead of capitulating, in September 2019 he publicly disclosed the fact that he added Canadian Tire to his position, He explains the rationale for this in a BNN interview late 2019. Essentially, his big concern with respect to banks was non-performing loans in Alberta. He feels Canadian bank CEOs are not prepared for a credit cycle. He specifically referenced ATB (a private bank) in discussing his concerns. Looking at the numbers today, my guess is that he has made off like a bandit.


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

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

THE HOUSING BOOM THAT NEVER ENDS ALREADY WIPED OUT ALL THE SHORT-SELLERS

Bloomberg - Ari Altstedter and Kevin Orland (2021-06-15)

Normally this kind of quick-buck speculation would be interpreted by economists, policy makers and finance types as the indisputable sign of a housing bubble. But Moore has been a professional house flipper in the Toronto area for more than a decade now, during which a seemingly endless line of illustrious doomsayers have taken the other side of his bet on real estate in word and deed, only to be proven wrong.

One of the earliest was Mark Carney, then Canada’s central bank governor but soon to take over the Bank of England, who called the country’s reliance on housing wealth “ unsustainable” back in 2012. Then came the wave of American financiers, one after the other, whose collective bet on a Canadian housing crash got its own nickname, “The Great White Short.” Many of them, like Steve Eisman of The Big Short fame, applied the lessons they had learned in the bursting of the U.S. housing bubble years earlier.


END OF AN ERA AS POLOZ EXITS BANK OF CANADA

G&M - DAVID PARKINSON (2021-06-01)

Stephen Poloz had only been Governor of the Bank of Canada for a few months in the late summer of 2013, when he gave a speech that defined his unique communication style and signalled a new era for a traditionally staid institution.


CANADA’S ANTI-MONEY LAUNDERING AGENCY STRUGGLES TO IMPLEMENT REFORMS AS EMPLOYEES WORK FROM HOME

G&M - Vanmala Subramaniam (2021-04-15)

Internal documents from the Financial Transactions and Reports Analysis Centre of Canada (FinTRAC) obtained through freedom of information legislation paint a picture of substantial disruption at the agency, especially in the first few months of the pandemic, when hundreds of employees were abruptly forced to work from home.


BORIS WERTZ’S VERSION ONE VENTURES WINS BIG AS COINBASE SHARES SOAR IN DEBUT

G&M - Sean Silcoff, Vanmala Subramaniam (2021-04-15)

Version One, led by Boris Wertz and Angela Tran, invested US$2-million across two private financings of Coinbase in 2017 and 2018, picking up about 151,000 shares. Both investments were made from its $35-million (US$28-million) second venture fund.


CERBERUS CAPITAL SELLS CONTROLLING STAKE IN CANADA’S ABC TECHNOLOGIES JUST WEEKS AFTER IPO

G&M - Jaren Kerr (2021-04-15)

Apollo will purchase $276.6-million of shares from ABC’s parent company Cerberus Capital Management LP, but made no offer to to buy shares from public shareholders, who will own approximately 20.9 per cent of outstanding shares when the deal closes. Shares of ABC have traded at low volumes. Nearly 80 per cent of the company’s outstanding shares are owned by insiders.


PONZI SCHEMER BERNIE MADOFF DIES AT 82 IN PRISON

G&M - JONATHAN STEMPEL AND BILL TROTT (2021-04-15)

Bernard Madoff, who for decades masqueraded as a successful and trustworthy Wall Street kingpin before admitting to running the largest known Ponzi scheme in history, died on Wednesday in prison where he was serving a 150-year sentence. He was 82.


BUSINESSES ARE SITTING ON RECORD $130B IN EXCESS CASH, BUT WILL THEY INVEST IT COMING OUT OF THE PANDEMIC?

FP - Bianca Bharti (2021-04-15)

One major inhibitor to business investment is the federal government’s Canadian Emergency Business Account program, which provides interest-free loans of up to $40,000 and recently expanded to $60,000. More than 500,000 Canadian businesses have received CEBA support so far, which totals more than $46 billion.


COINBASE TOPS $100-BILLION VALUE, THEN SLIPS IN LANDMARK CRYPTOCURRENCY LISTING

FP - Crystal Tse, Katie Roof and Olga Kharif (2021-04-15)

The massive valuation, which dwarfs more traditional financial companies including Intercontinental Exchange Group Inc. and Nasdaq Inc. itself, is a landmark moment for the crypto industry and for Coinbase, which was started almost a decade ago when few people had even heard of Bitcoin, and many exchanges were run by amateurs from their garages and homes.


I HAVEN'T BEEN THIS EXCITED ABOUT GOING AGAINST THE HERD IN YEARS

FP - David Rosenberg (2021-04-15)

Yes, I am not positioned the way the dominant “Roaring Twenties” crowd is, that much is for sure. But I have been here before. When I turned bearish on tech at the height of the dotcom bubble back in 2000, my partners at the time thought I was nuts.


MASTERCARD REWRITES RULES FOR BANKS BACKING PORNOGRAPHY SELLERS

Bloomberg - Jennifer Surane (2021-04-15)

The banks will now have to ensure that sellers require “clear, unambiguous and documented consent” in adult content, the payments network said in a blog post Wednesday. The firms will also be required to ensure websites document the age and verify the identity of anyone depicted in pictures and videos as well as those uploading the content.


AS BANK EARNINGS ROLL IN, A MIXED PICTURE FOR LOANS

Reuters - Dan Burns (2021-04-15)

Indeed, the bank credit picture as the first quarter ended was decidedly mixed, according to U.S. Federal Reserve data, with some indications that consumer credit demand is coming back to life but demand for bread-and-butter business loans remains lacking.


GOLDMAN SACHS' BUMPER QUARTER FUELS OPTIMISM ON TARGETS

Reuters - Anirban Sen, Matt Scuffham (2021-04-15)

The trends helped Goldman produce record quarterly revenue and earnings, and its highest return-on-equity since 2009. That metric shows how much profit a bank can generate from shareholder money, and is closely watched by investors.


A $9 MILLION BOSS? UNICREDIT INVESTORS TO DECIDE HOW MUCH ORCEL IS WORTH

Reuters - Valentina Za, Maria Pia Quaglia, Simon Jessop 5 MIN READ (2021-04-15)

Though only a fraction of the $30 million-plus bonuses Orcel got as a Merrill Lynch banker earlier in his career, UniCredit’s offer of up to 7.5 million euros ($9 million) a year puts him ahead of British bank Lloyds’ new CEO Charlie Nunn and of most European peers, analysts said.


CHINA’S VERY BAD BANK: INSIDE THE HUARONG DEBT DEBACLE

Bloomberg - Bloomberg (2021-04-15)

From Hong Kong to London to New York, questions burn. Will the Chinese government stand behind $23.2 billion that Lai borrowed on overseas markets -- or will international bond investors have to swallow losses? Are key state-owned enterprises like Huarong still too big to fail, as global finance has long assumed – or will these companies be allowed to stumble, just like anyone else?


GOLDMAN, JPMORGAN TRADERS SHOW THE REDDIT CROWD HOW IT’S DONE

Bloomberg - Jennifer Surane (2021-04-15)

In all, Goldman’s traders boosted revenue 47% to $7.58 billion -- more than $2 billion higher than what analysts had projected. Goldman’s dealmakers were busy too, more than doubling investment-banking fees, excluding corporate lending.


RBC, SCOTIABANK JOIN ROGERS C$19 BILLION LOAN FOR SHAW PURCHASE

Bloomberg - Esteban Duarte and Paula Seligson (2021-04-15)

Royal Bank of Canada and Bank of Nova Scotia have signed on to help provide the C$19 billion ($15.2 billion) bridge loan raised by Rogers Communications Inc. to buy a smaller rival, according to a person familiar with the matter.

Bank of America Corp., which was initially the sole lender on the transaction, carried out a first round of the syndication with the two Canadian banks, said the person who asked not to be named as the matter is private. The banks plan to carry out another general syndication round, the person said. Bank of America continues as the larger lender on that transaction, the person said. Representatives for Rogers, Bank of America, RBC and Scotiabank declined to comment. Toronto-based Rogers said last month it agreed to buy Shaw Communications Inc. for about C$20 billion in one of the largest merger and acquisition deals in Canada. The transaction was announced as the country’s telecom carriers are getting ready for an auction of 5G airwaves, for which bidding is expected to start June 15.


CENTRAL BANKING’S GREEN LIMITS SPARK LEGAL DEBATE IN SWEDEN

Bloomberg - Bloomberg (2021-04-15)

How should a central bank respond to global warming? In Sweden, a body created to monitor government efforts to fight climate change says the law that guides monetary policy needs a serious overhaul.

Cecilia Hermansson, the vice chair of the Swedish Climate Policy Council, is advising the government to include environmental considerations in the Riksbank Act, which is currently under review. She also says an existing proposal to amend the law doesn’t go nearly far enough.


BMO SEES SOARING LUMBER PRICES CRASHING SOON, WHICH MAY LOWER NEW HOME COSTS

Better Dwelling - Daniel Wong (2021-04-15)

Lumber prices are rising at an incredibly fast rate, hitting new records. The price of SPF lumber reached US$1,083/mbf this week, up 241.6% from a year ago. This is around twice the average price in 2020, which was the previous lumber price record. And you thought homes were a good investment? You would have made way more just hoarding wood. 


CANADA’S PROPERTY BUBBLE IS NOW SO LARGE, A SOFT LANDING WOULD TAKE 19 YEARS

Better Dwelling - Stephen Punwasi (2021-04-15)

Even if you’re willing to entertain an unrealistic scenario, the best case for a soft landing is a tough sell. Households need to see their wages grow 2 points faster than home prices, for over a decade. Almost two decades in Toronto and Vancouver. The middle-aged Millennial would be halfway through their adult working years. In which case, it may be very risky to consider a home as one’s primary retirement vehicle. That means diversifying bets, which makes astronomical down-payments even less attainable.


SHOPIFY EXECUTIVE EXODUS CONTINUES AS NEARLY HALF OF C-LEVEL TEAM SET TO LEAVE COMPANY

G&M - Sean Silcoff (2021-04-15)

Mr. Lutke said in a blog post that chief talent officer Brittany Forsyth, chief legal officer Joe Frasca and chief technology officer Jean-Michel Lemieux would all “transition out of their current roles,” which they have all held for at least six years, in the coming months.

“Each of them has their individual reasons but what was unanimous with all three was that this was the best for them and the best for Shopify.” He added the three were “leaving [Shopify] perfectly on time.”

Ms. Forsyth was Shopify’s 22nd employee, joining one year after earning a business undergraduate degree at Carleton University. She is one of a group of present and former female Shopify leaders who recently launched investment collective Backbone Angels

Loading... to back early-stage female and non-binary founders.


CANADA’S ACCOUNTING-FIRM PROBLEM CHILD REMAINS A MYSTERY

G&M - David Milstead (2021-04-15)

CPAB’s key performance metric is what it calls a “significant finding.” Put simply, it’s where an accounting firm falls short of accepted auditing standards for a material part of a particular company’s financial statements and has to go back and do additional work to support its audit opinion. One example of a deficiency, CPAB said, is “overreliance on management representations without corroboration with third-party evidence.”


CANADIAN HOME PRICES HIT RECORD HIGHS IN MARCH, REACHING ‘UNCHARTED TERRITORY’

G&M - Rachelle Younglai (2021-04-15)

Canadian home sales and prices hit another record in March, with prices spiralling up in most of Ontario as calls intensified for measures to slow the country’s unruly market.


AIMCO NAMES FORMER CMHC HEAD EVAN SIDDALL AS NEXT CEO

G&M - Andrew Willis (2021-04-15)

Alberta’s government-owned investment fund named Evan Siddall as its new chief executive officer on Thursday, while announcing the $118-billion asset manager underperformed its benchmark last year.


BLACKROCK PROFIT BEATS ESTIMATES AS ASSETS TOP $9 TRILLION

Reuters - Ambar WarrickSaqib Ahmed (2021-04-15)

BlackRock's net income rose to $1.2 billion, or $7.77 per share, in the three months ended March 31, from $1.03 billion, or $6.60 per share, a year earlier. The reading was above the Refinitiv IBES estimate of $7.64 per share.


DAY TRADER FEVER TICKING BACK UP IN LATEST SHOW OF RETAIL PLUCK

Bloomberg - Lu Wang and Vildana Hajric (2021-04-15)

In a market where stock indexes hit record highs almost every other day, a new report from JPMorgan Chase & Co. finds that do-it-yourself investors are jumping back in. Strategists including Peng Cheng studied recent equity and option transactions from retail investors and concluded these prominent players in the yearlong bull market are once again ratcheting up their wagers.


CITI’S NEW CEO TAPS FAMILIAR STRATEGY WITH RETAIL BANKING EXITS

Bloomberg - Jennifer Surane and Alex Tribou (2021-04-15)

Fraser, who rose to the top of the firm last month, is on familiar ground as she moves to exit retail banking in 13 markets across Asia, Europe, the Middle East and Africa as part of a strategic overhaul. Within a year of taking over the company’s operations in Latin America in 2015, the former consultant oversaw sales of retail-banking and credit-card operations in Brazil, Argentina and Colombia.


WALL STREET BANK CEOS TO TESTIFY BEFORE CONGRESS NEXT MONTH

Bloomberg - Jessie Hamilton (2021-04-15)

The chief executives of the largest U.S. banks, including JPMorgan Chase & Co. and Goldman Sachs Group Inc., are being called to Capitol Hill to testify before lawmakers next month.


BIDEN IMPOSES TOUGH NEW SANCTIONS ON MOSCOW

FT - Henry Foy, Katrina Manson, Michael Peel (2021-04-15)

On Wednesday, the US for the first time formally blamed SVR, Russia’s foreign intelligence service, for the SolarWinds hack, which affected at least nine federal agencies and 100 companies. One senior administration official told reporters the hack gave Russia “the ability to spy on or potentially disrupt more than 16,000 computer systems worldwide”.


WIDELY USED UK FUND COMPARISON TOOL ADDS ETFS FOR FIRST TIME

FT - Chris Flood (2021-04-15)

The IA sectors provide an important tool to help financial advisers and individual investors to make like-for-like comparisons between thousands of funds by dividing them into clearly defined groups, each with a distinct investment focus.


BANK OF AMERICA’S QUARTERLY PROFIT MORE THAN DOUBLES

FT - Laura Noonan (2021-04-15)

Net income at the second-biggest US bank by assets more than doubled in the first quarter, fuelled by a $1.9bn gain on the improving outlook for loan losses. Investment banking fees rose 62 per cent. Its board has authorised a $25bn common share buyback “over time” that will release some of the $35bn in excess capital sitting on BofA’s balance sheet after regulators restricted banks’ capacity to return cash to shareholders in case the pandemic triggered a wave of defaults.


HEDGE FUNDS RETHINK AFTER GAMESTOP PAIN

FT - Laurence Fletcher (2021-04-15)

Losses were exacerbated because many funds were crowding into the same trade. Short selling involves of borrowing shares, selling them, and later buying them back in the market, to give them back to the lender. If the price has fallen as anticipated, the trading yields a profit for the short seller. In the case of Game Stop, it did the opposite, and the funds’ simultaneous rush to close their losing bets by buying back the shares only pushed the price higher, in a so-called “short squeeze”.


SOFTBANK INFUSION MEANT TO PAY BACK CREDIT SUISSE INVESTORS WENT TO GREENSILL BANK

WSJ - Julie Steinberg and Duncan Mavin (2021-04-15)

When SoftBank Group Corp. made a last ditch-infusion of $440 million into Greensill Capital last November, the money was earmarked to pay off investors in Credit Suisse Group AG investment funds, according to people familiar with the deal.


WHY BARCLAYS IS ONE OF THE YEAR’S BEST-PERFORMING BANK STOCKS

WSJ - Simon Clark (2021-04-15)

Barclays PLC’s stock has long been stuck in the mud, but so far this year it is zooming ahead of the likes of JPMorgan Chase & Co. and Morgan Stanley .


CONDO CONSTRUCTION HAMMERED BY RAPID RISE IN COSTS

G&M - Shane Dingman (2021-04-15)

Construction costs in Canada are expected to soar in 2021, with Toronto leading the way thanks in part to booming prices for the materials and labour that go into high-rise buildings.


BANK HACKS, ONLINE MERCHANDISE FRAUD AND PHISHING ATTEMPTS HAVE SKYROCKETED DURING COVID-19 PANDEMIC

G&M - SALMAAN FAROOQUI (2021-04-15)

At a time when more people than ever are looking online to get important information about the pandemic and vaccines, Tony Anscombe, chief security evangelist at ESET, said people are at risk of their personal information being compromised.


THEY’RE RENEWING A MORTGAGE – SHOULD THEY GO FIXED OR VARIABLE?

G&M - Rob Carrick (2021-04-14)

With house prices surging month by month across the country, low mortgage rates are more important than ever in making a home purchase affordable.


EASYFUND IS NOW AVAILABLE DIRECTLY THROUGH THE CONVEYANCER

FCT - FCT (2021-04-14)

First Canada Title (FCT) are now in the EFT business and launched an Alberta payment solution for the legal community that is designed to eliminate cheques. 


INDIA'S CORONAVIRUS CASES HIT RECORD AS MUMBAI PREPARES FOR NEW LOCKDOWN

Reuters - Shilpa Jamkhandikar, Sumit Khanna (2021-04-14)

The country reported 184,372 cases in the last 24 hours, health ministry data showed, taking total infections to 13.9 million. Deaths rose by 1,027, for a toll of 172,085.


RETAIL GIANT W. GALEN WESTON HAS DIED AT AGE 80

CBC - CBC (2021-04-14)

"My father's greatest gift was inspiring those around him to achieve more than they thought possible," said his son Galen G. Weston, known as Galen Weston Jr., who is CEO of both Loblaws and the George Weston Company Ltd.


SCOTIA’S GLOBAL MARKETS CHIEF SEES ROLE FOR BANKS IN CANADA HOUSING CRUNCH

Bloomberg - Kevin Orland (2021-04-14)

“We need all levels of government -- municipal, provincial and federal -- to work together to ease obstacles to construction for all forms of housing,” Lawrence said. “Whether it’s affordable, whether it’s rentals or owned accommodations, a key step is getting more supply in the market.”


WALMART COMPLIANCE CHIEF TO DEPART

WSJ - Daniel Trujillo (2021-04-14)

Mr. Trujillo, will depart the Bentonville, Ark., company on Friday, according to an internal memo shared with The Wall Street Journal.


MAJORITY OF CANADIANS BELIEVE HOME PRICES ONLY GO UP, MOST WILL NEVER OWN: RBC

Better Dwelling - Daniel Wong (2021-04-14)

Most Canadians think the majority of households will be priced out of the market for the next decade. RBC found 62% of households across the country agreed the majority of people are priced out. The number was higher in BC and Ontario, where 71% of people agree. 


FINANCIAL INDUSTRY HAS THRIVED OUTSIDE OF THE OFFICE: SURVEY

Investment Executive - James Langton (2021-04-14)

The firm, which surveyed over 200 financial markets professionals (primarily in North America), reported that half of respondents said that the shift to working from home has enhanced efficiency by accelerating the use of digital tools for communication and collaboration.


SECOND WALL STREET EXEC ADMITS TO FRAUD

Investment Executive - James Langton (2021-04-14)

“Today, Martin Silver admitted to participating in a sophisticated, decade-long scheme to defraud IIG funds and investors, abandoning his fiduciary responsibilities to IIG’s clients, and causing millions of dollars of losses,” said Audrey Strauss, U.S. attorney for the Southern District of New York, in a release.


COINBASE HITS $76BN VALUATION ON MARKET DEBUT

Finextra - Finextra (2021-04-14)

The opening price was 52% up on Coinbase's reference price of $250 and makes the company more valuable than financial heavyweights including Nasdaq and Discover.


RUSSIA PUSHES AHEAD WITH DIGITAL RUBLE

Finextra - Finextra (2021-04-13)

As with China's digital yuan, commercial banks will be able to open electronic wallets for their clients and perform operations over these wallets on the digital ruble platform.


BARCLAYS TO SHUT DOWN PINGIT ON 30 JUNE

Finextra - Finextra (2021-04-13)

Barclays last big push on the app came in 2019, when it moved its bpay wearable brand to Pingit and introduced a slew of new features in a last gasp attempt to keep up with innovations from Big Tech giants and fintech startups in the money transfer space.


ASSET MANAGEMENT FIRMS: THEY MANAGE OUR MONEY, BUT SHOULD WE BUY THEIR STOCK?

G&M - Brian Donovan (2021-04-13)

StockCalc is a fundamental valuation platform with tools to calculate and report on value per share for thousands of public companies listed on major North American stock exchanges. StockCalc also contains numerous tools to understand what the stocks you are investing in are worth. Globe Unlimited subscribers can subscribe to StockCalc using the promo code Globe30, which offers a 30-day free trial and special pricing for the second month).


GRAB TO UNVEIL WORLD'S BIGGEST SPAC MERGER, VALUED AT NEARLY $40 BILLION: SOURCES

Reuters - Anshuman Daga (2021-04-13)

Southeast Asia’s biggest ride-hailing and food delivery firm Grab Holdings will announce as early as Tuesday a merger with U.S.-based Altimeter that will value Grab at nearly $40 billion and lead to a public listing, four people told Reuters.


UK OPENS PROBE INTO GREENSILL LOBBYING BY EX-PM CAMERON

Reuters - Staff (2021-04-13)

The Financial Times and Sunday Times newspapers have reported that Cameron contacted ministers directly to lobby on behalf of Greensill Capital, including sending text messages to finance minister Rishi Sunak and arranging a private drink between Greensill and Health Secretary Matt Hancock.


CANADA SAYS PROPERTY BUBBLE “NOT GREAT” FOR LOCALS, GOOD FOR FOREIGN INVESTORS

Better Dwelling - Stephen Punwasi (2021-04-13)

When discussing a price drop, the minister said “I can understand why that is seen as a positive thing for people who are trying to get into the market, but hands up if you’d like to see 10 percent of the equity in your home suddenly disappear overnight.” 


OSFI’S EFFORTS TO COOL HOUSING MARKET GOOD FOR BANKS: MOODY’S

Investment Executive - James Langton (2021-04-13)

“The minimum qualifying rate adds a margin of safety that ensures borrowers will have the ability to make mortgage payments in the event of change in circumstances, such as the reduction of income or a rise in mortgage interest rates,” the regulator said.


OSFI LAUNCHES CONSULTATION ON ENHANCED ASSURANCE EXPECTATIONS

OSFI - OSFI (2021-04-13)

Today the Office of the Superintendent of Financial Institutions (OSFI) launched a ten-week consultation with the publication of a discussion paper, Assurance on Capital, Leverage and Liquidity Returns for federally regulated insurers (FRIs) and deposit-taking institutions (DTIs). The paper focuses on enhancing and aligning assurance expectations given the increasing complexity arising from the evolving regulatory reporting framework, particularly changes resulting from International Financial Reporting Standards 17 Insurance Contracts and the Basel III reforms.


CANADA INFRASTRUCTURE BANK AND FORTIS SUBSIDIARY INVEST IN UNDERWATER TRANSMISSION LINE

G&M - CP (2021-04-13)

The Canada Infrastructure Bank and ITC Investment Holdings have signed a deal to invest $1.7-billion in an underwater transmission line connecting Ontario to Pennsylvania under Lake Erie.


DAMAGE REPORT: COMPARING THE YEAR-TO-DATE LOSSES FOR VARIOUS KINDS OF BOND ETFS

G&M - Rob Carrick (2021-04-13)

Bonds and stocks both had an outstanding year in 2020, but they’ve parted ways this year.


SCOTIABANK CEO BRIAN PORTER WANTS TOP UP FOR CHILD TAX CREDIT, GRANTS FOR BUSINESSES

G&M - Tara Deschamps (2021-04-13)

The head of the Bank of Nova Scotia is urging Ottawa to adopt a series of policy changes to help parents, businesses of all sizes and companies trade between provinces.


FED’S POWELL SAYS U.S. ECONOMY AT AN 'INFLECTION POINT'

G&M - Reuters Video (2021-04-13)

According to Federal Reserve Chair Jerome Powell, the U.S. economy is at an "inflection point" with expectations that growth and hiring will pick up speed in the months ahead, but some risks remain, particularly any resurgence in the coronavirus pandemic.


U.S. CONSUMER PRICES POST BIGGEST GAIN IN 8½ YEARS AS ECONOMY REOPENS

G&M - Lucia Mutakani (2021-04-13)

“Inflation is a process and not a one-time event,” said Chris Low, chief economist at FHN Financial in New York. “These bottlenecks are one offs. The Fed will not consider action until it views price levels changes as permanent rather than temporary, something it does not consider possible until the economy is at full employment.”


HOW BANK STOCKS WILL BE AFFECTED BY OSFI EFFORTS TO COOL HOUSING MARKET

G&M - Scott Barlow (2021-04-12)

“Focus on stock-bond correlation misses a main way fixed income diversifies: Stock-bond correlation has been rising. While this dynamic raises fears that bonds won’t diversify, we think this overlooks how most portfolios experience fixed income diversification. A large part of the benefit to a 60:40 portfolio comes from bonds’ lower volatility and ‘not 1’ correlation, two elements that remain very much in place … Instead of whether fixed income can diversify, we think that the more practical question is whether low yields mean it is simply dead weight… Based on Morgan Stanley’s forecasts through end-2021, both government bonds and corporate credit should post positive returns, outperforming cash. Meanwhile, recent stock market gains mean that our full-year forecasts for equities imply returns lower than those in fixed income. Our forecasts imply that fixed income can still ‘do its job’ in a broader portfolio context.”


BITCOIN RISES ABOVE US$60,000 AGAIN ON TALK OF REDUCED SUPPLY

G&M - Bitcoin rises above US$60,000 again on talk of reduced supply (2021-04-12)

Bitcoin is up 116 per cent from the year’s low of US$27,734 on Jan. 4. It crossed the US$60,000 mark for the first time on March 13, hitting a record US$61,781.83 on Bitstamp exchange, just after U.S. President Joe Biden signed his US$1.9-trillion fiscal stimulus package into law.


CHINA FINES ALIBABA $2.8-BILLION IN LANDMARK ANTITRUST CASE

G&M - Raymond Zhong (2021-04-12)

The penalty imposed on Alibaba, one of China’s most valuable private companies and the bedrock of the business empire of Jack Ma, its most famous tycoon, was the biggest move yet in the government’s campaign to tighten its supervision of Big Tech.

China’s market watchdog in December began investigating whether Alibaba had broken the country’s anti-monopoly law by preventing merchants from selling their goods on other shopping platforms. On Saturday, the regulator said it had concluded that Alibaba’s exclusionary practices had hindered competition in online retail, affected innovation in the internet economy and harmed consumers’ interests.

The resulting fine far exceeds the $975 million antitrust penalty that China imposed on Qualcomm 

QCOM-Q +0.16%increase   , the American chip giant, in 2015.


WHAT THE STRESS TEST CHANGE ACTUALLY MEANS FOR YOU AS A MORTGAGE SHOPPER

G&M - Robert Mclister (2021-04-12)

Getting approved for a mortgage will get trickier thanks to proposed stress test changes from our banking regulator. But if you’re a mortgage shopper fretting tougher borrowing rules, don’t.


LOW RATES LEAVE POLICYMAKERS WITH TOUGH CHOICES AS PANDEMIC HOUSING BOOM RAGES

FP - Geoff Zochodne (2021-04-12)

“We feel a responsibility to make sure that the financial system is ready in case we have to return to pre-pandemic financial conditions,” Superintendent Jeremy Rudin told reporters on Thursday. “We have extraordinary low interest rates, because of the extraordinary circumstances of the pandemic, and extraordinary circumstances require extraordinary measures.”


MARK CARNEY'S BIG STUMBLE AT BROOKFIELD INTENSIFIES FOCUS ON NET-ZERO EMISSIONS CLAIMS

FP - Camilla Hodgson (2021-04-12)

Climate experts led by the respected Science Based Targets initiative promptly deemed it “greenwashing,” and Carney swiftly rowed back his remarks, saying he was “a strong advocate for net zero science-based targets,” which so-called avoided emissions “do not count towards.”


ONCE UPON A TIME IN CANADA BANKING WAS LIKE THE WILD WEST

FP - John Turley-Ewart (2021-04-12)

Here is the reality: 61 per cent of the new banks launched in the 1870s failed. In the 1880s, 75 per cent of new banks failed. Between 1900 and 1923, 37 per cent of new banks failed. (No new banks opened for business in the 1890s due to a combination of factors, including economic depression in the early part of the decade and investor sentiment that Canada had become “over-banked.”) Before 1871, the bank failure rate had been just 20 per cent.


BMO EXECUTIVE LESLEY MARKS DEPARTS TO TAKE CIO ROLE AT MACKENZIE INVESTMENTS

FP - Kevin Orland (2021-04-12)

In her most recent role at BMO, Marks managed more than 80 investment professionals and had overall responsibility for the bank’s private wealth investment management platforms, and led research, product, trading and investment strategy.


PAYMENTS FIRM TRUSTLY AIMS FOR 9 BILLION EURO VALUATION IN STOCKHOLM IPO

Reuters - Supantha Mukherjee, Arno Schuetze, Abhinav Ramnarayan (2021-04-12)

Swedish payments firm Trustly said on Monday it intends to list its shares on the Nasdaq Stockholm exchange, the latest in a line of major European tech unicorns seeking a stock market listing.


EUROPE IS HEADING TOWARD A NEW FINANCIAL CRISIS

Bloomberg - Editorial Board (2021-04-12)

Europe faces a predicament. Even as it struggles to contain the Covid-19 pandemic, it’s setting itself up for another crisis — this one financial. To ensure the viability of the common currency at the heart of the European project, the EU’s leaders will have to cooperate in ways they’ve so far resisted.


COMPANIES ARE SELLING THEIR REAL ESTATE AT THE FASTEST PACE EVER

Bloomberg - Jack Sidders (2021-04-12)

Firms across Europe, the Middle East and Africa sold 27 billion euros ($32 billion) of corporate properties in 2020, according to a report by broker Jones Lang LaSalle Inc. That was slightly more than a year earlier, even as overall real estate deals collapsed during the pandemic.


ZIMBABWE PRESIDENT WARNS OF CRACKDOWN ON FINANCIAL INDUSTRY

Bloomberg - Ray Zdlovu (2021-04-12)

Mnangagwa has previously issued warnings to private companies he blames for undermining his efforts to turn around an economy plagued by annual inflation of 241% and foreign-currency shortages. Last year, his government closed the Zimbabwe Stock Exchange for five weeks and singled out the largest mobile operator, Econet Wireless Zimbabwe Ltd., for undermining the nation’s currency through its mobile money service


POLICY-MAKERS SHOULD TACKLE HOUSING SUPPLY WITH MORE DENSITY AND TRANSIT: DODIG

Investment Executive - Tara Deschamps (2021-04-12)

“There’s not enough supply and in the end, you can regulate, regulate, regulate or you can look at opening up the market to more housing supply and I think that is the real long-term solution,” Dodig said in an interview.


ECONOMY ADDS 303,000 JOBS IN MARCH

Investment Executive - Jordan Press (2021-04-12)

The March increase puts overall employment 296,000 shy of the pre-Covid level in February 2020, a gap of 1.5%. The unemployment rate was 7.5%, down from 8.2% in February, hauling the rate to a pandemic-era low.


BANK OF CANADA RELEASES RESULTS FROM CONSULTATIONS ON INFLATION AND MONETARY POLICY

BOC - BOC (2021-04-12)

Most respondents also said they would prefer an approach that balances the level of interest rates to benefit both savers and borrowers. Additionally, the majority viewed inflation targeting as the most easily understood approach.


INTRODUCTORY REMARKS BY SUPERINTENDENT JEREMY RUDIN AT TORYS LLP ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) SESSION VIA WEBCAST, APRIL 7, 2021

OSFI - OSFI (2021-04-12)

For OSFI, our focus in these matters is prudential. That is to say that our unique role is to ensure that Canadians continue to enjoy financial stability as climate-related risks manifest themselves. This is a very important role, and one that we take very seriously, especially as we are the only arm of the Government of Canada that is equipped to meet this prudential responsibility.


WHATEVER WE MAY THINK OF MODERN MONETARY THEORY, ITS DAY IN THE SUN HAS ARRIVED

G&M - DAVID PARKINSON (2021-04-12)

Last fall, as Chrystia Freeland began laying the groundwork for a postpandemic recovery strategy that would heap more debt onto the federal government’s already immense pile, she felt obliged to assure Canadians that, no, she hasn’t invited a three-initialled economic bogeyman to live under our bed.


FORMER VANGUARD CANADA CEO LAUNCHES SERVICE FOR CANADIAN RETAIL INVESTORS TO BUY FINE WINES

G&M - Clare O'Hara (2021-04-12)

After a two-year hiatus from Bay Street, former Vanguard Canada chief executive Atul Tiwari is raising a glass to a new joint venture with British-based Cult Wine Ltd. that will allow retail investors to access fine-wine investing.


ONTARIO’S FINANCIAL REGULATOR GIVES PACE $500-MILLION CREDIT FACILITY TO ENSURE IT CAN KEEP OPERATING

G&M - James Bradshaw (2021-04-12)

Ontario’s financial regulator has given an extraordinary lifeline to PACE Savings and Credit Union after the troubled financial institution’s capital levels fell below minimum requirements, threatening to put its financial stability in doubt.

The Financial Services Regulatory Authority of Ontario, or FSRA, revealed on Monday that PACE’s regulatory capital – which acts as a cushion to absorb losses or unexpected shocks – will come up short when its 2020 financial statements are released this week. In response, FSRA temporarily lowered minimum capital thresholds for the credit union and will provide a $500-million credit facility to make sure PACE has enough money to meet demand to withdraw deposits.

It is the first time the regulator has extended such a loan to a credit union. FSRA has also barred PACE from paying dividends, redeeming investment shares owned by members except in special circumstances, or paying bonuses to managers and employees.

The rare and significant steps the regulator is taking are to help PACE “continue to operate as a credit union,” and to protect its members, according to FSRA. They are also to bolster confidence that PACE remains viable and to calm nervous members, providing extra financial capacity should members choose to pull their deposits. The credit union has been under varying levels of administrative control and oversight from FSRA and a previous regulator since the fall of 2018, and has suffered repeated false starts while trying to recover from allegations that former senior executives engaged in fraud and self-dealing

Loading... over a period of years.


BMO SELLS EMEA ASSET MANAGEMENT BUSINESS FOR $1.1-BILLION TO AMERIPRISE FINANCIAL

G&M - James Bradshaw (2021-04-12)

The return BMO was earning from the business does not appear to have matched the cost of running it. If the deal closes, BMO said it will not have a significant impact on future profits. But it will boost the bank’s efficiency ratio – a metric BMO’s investors watch closely that measures expenses relative to revenue – by 64 basis points (100 basis points equal one percentage point).

The sale is the largest in a series of recent divestitures BMO has made in its drive toward greater efficiency. BMO hopes to concentrate more of its resources on business lines where it has better prospects of earning a strong return, including its North American asset management business, especially in Canada. In January, BMO sold its Asian private-banking business

Loading... , and a month earlier, the bank announced its investment dealer would exit the energy sector in the U.S.


CI FINANCIAL NAMES AMIT MUNI AS CHIEF FINANCIAL OFFICER

G&M - Clare O'Hara (2021-04-12)

Mr. Muni will start his new role no later than May 31 and will replace Douglas Jamieson, who announced last November he planned to depart the wealth manager. At the time, Mr. Jamieson declined to comment on his resignation, which came a day after CI received regulatory approval to list its common shares on the New York Stock Exchange.


WANT TO COOL THE HOUSING MARKET? FORCE BANKS TO SHOULDER MORE RISK

G&M - Rita Trichur (2021-04-12)

It seems like just yesterday that banks were handing out mortgage deferrals and allowing customers to skip loan payments to stave off a crisis. Last spring, there were fears that housing prices would crash during the pandemic. But now they’re climbing too high. Talk about whiplash.

Although the banking regulator, the Office of the Superintendent of Financial Institutions, is proposing stricter mortgage rules, it’s already obvious that more needs to be done to cool the market.

OSFI’s proposal, which involves a tougher stress test for uninsured mortgages beginning June 1, is a start. But the spring-buying season is expected to be supercharged with buyers trying to beat the clock. Worse still, some experts are already warning that a more stringent stress test won’t be enough to restrain runaway home prices.

 

It’s easy to see why. Not only are interest rates expected to remain low, but consumers have stockpiled an estimated $220-billion 

Loading... in their bank accounts. Sure, some of that cash will be eventually spent on travel and entertainment. But it will also fund down payments.


CAROLYN WILKINS APPOINTED TO BANK OF ENGLAND COMMITTEE OVERSEEING BRITAIN’S FINANCIAL STABILITY

G&M - Mark Rendell (2021-04-09)

Carolyn Wilkins, the former second-in-command at the Bank of Canada, has been appointed to the Bank of England committee that oversees financial stability in Britain.


CANADIAN INHERITANCES COULD HIT $1 TRILLION OVER THE NEXT DECADE AND BOTH BEQUEATHERS AND BENEFICIARIES NEED TO BE READY

FP - Jason Heath (2021-04-09)

Some seniors feel they need to leave an inheritance. According to a 2019 survey by Merrill Lynch and Age Wave, 47 per cent of respondents aged 55 and older said leaving an inheritance was “the right thing to do” for their children. Fifty-five per cent of millennials, meanwhile said “it’s a parent’s obligation” to leave an inheritance. The generation that most of the millennials’ parents belong to — the baby boomers — partially agree; 36 per cent of boomers felt that an inheritance is a parent’s obligation.


CHINA'S DIDI PICKS GOLDMAN, MORGAN STANLEY FOR MEGA U.S. IPO - SOURCES

Reuters - Julie Zhu (2021-04-09)

China’s top ride-hailing firm Didi Chuxing has mandated Goldman Sachs and Morgan Stanley to lead its blockbuster IPO and plans to file confidentially for the New York float this month, two people with knowledge of the matter said.


RBC’S MCKAY GIVES STAFF A DAY OFF WITH WORKERS MORE ‘EXHAUSTED’ THAN EVER

Bloomberg - Kevin Orland (2021-04-09)

RBC Chief Executive Officer Dave McKay acknowledged that staff are more exhausted now than at any time during the Covid-19 pandemic. The bank needs to “eliminate the stigma associated with asking for time to focus, concentrate, and in some cases, log off and recharge,” McKay said in a companywide memo on Thursday.


NEW BONDS FUEL LENDING TO FAST-GROWING BUT UNPROFITABLE TECH COMPANIES

WSJ - Matt Wirz (2021-04-09)

No earnings? No problem. Investors are funneling money to unprofitable software companies through a new type of debt deal.


CANADIAN BANK REGULATOR READIES TO REVERSE EXTRA PANDEMIC MORTGAGE LEVERAGE

Better Dwelling - Stephen Punwasi (2021-04-09)

OSFI proposed an increase to the benchmark rate used for the mortgage stress tests. Uninsured mortgages would see the current benchmark rise from 4.79% to 5.25%, setting a new floor for leverage. If the move successfully proceeds, it would reduce the current max mortgage drop by 5%. Not exactly earth-shattering, but it rolls people back to pre-pandemic levels.


A HISTORIC PERIOD OF REGULATORY REFORM

Investment Executive - Paul Bourque (2021-04-09)

The consultations also commenced on the heels of the industry’s implementation of the Client Relationship Model (CRM2). The CRM2 reforms provided investors with arguably the best disclosure regime in the world for clients of investment dealers and mutual fund dealers.


FINTECH BILLIONAIRES REVEALED: WHO IS ON THE 2021 RICH LIST?

Finextra - Finextra (2021-04-09)

From the 2,755 on the Forbes World’s Billionaires List, here’s who is on the 2021 rich list from the fintech industry. Notable figures include John Collison, who was named the youngest person on the list in 2017, Revolut's Nik Storonsky and the Robinhood co-founders Baiju Bhatt and Vlad Tenev. 


BANK REGULATOR PROPOSES TOUGHER MORTGAGE RULES AS ULTRALOW RATES FUEL OVERHEATED HOUSING MARKET

G&M - Rachelle Younglai, James Bradshaw (2021-04-09)

Canada’s bank regulator wants to impose a higher threshold to qualify for a home loan, but the move could ratchet up already overheated real estate markets in the weeks before the rule is set to take effect.


RBC CEO URGES RESTRAINT ON MASSIVE STIMULUS SPENDING PROGRAM

G&M - Bill Curry, James Bradshaw (2021-04-09)

Hundreds of billions of dollars in cash have piled up in the bank accounts of Canadian consumers and businesses during the coronavirus pandemic. Even without new government spending, those savings will provide “a very significant primer to growth and recovery in the Canadian economy,” RBC CEO Dave McKay said on a conference call with reporters on Thursday.

Add an anticipated rise in disposable income as more people get back to work as public-health restrictions ease, as well as the Bank of Canada’s intention to keep interest rates at historic lows for some time, and there is significant unspent stimulus “already in the economy,” he said. That is driving fears about the prospect of rising inflation, which Mr. McKay predicts may start to show up before the end of next year.

The Liberal government’s plan to spend between $70-billion and $100-billion over three years on stimulus measures was the big surprise of its economic statement in November. At the time, Finance Minister Chrystia Freeland said the details would be developed over the following months and announced in the 2021 budget, which has since been scheduled for April 19.

“This is a read-and-react situation, and I would counsel that we don’t want to overdo this. And some of the numbers that I’m hearing could be overstimulative,” Mr. McKay said. “Why not keep our powder dry and see how we recover, knowing that we’ve got this dry powder to interject quickly, as we’ve shown we can do in the past year if things aren’t playing out the way we hoped.”

 

Mr. McKay’s advice is in line with recent comments from a wide range of fiscal policy observers – including the International Monetary Fund, the C.D. Howe Institute and the Parliamentary Budget Officer – that have questioned whether Canada still needs a $100-billion stimulus program.

The savings sitting in Canadian bank accounts exceed even the most ambitious spending targets signalled by the government. Consumers have about $220-billion of cash on hand – about $180-billion more than is normal, and equal to about 10 per cent of Canada’s economy, Mr. McKay said. And there is more cash on companies’ balance sheets. In the U.S., equivalent deposits are closing in on US$1.8-trillion, representing a similarly large share of the economy.

“That’s just unprecedented. It’s almost 10 [times] what a consumer would normally carry through a cycle,” Mr. McKay said.

In an interview this week, Canadian Imperial Bank of Commerce

CM-T -0.32%decrease  

 CEO Victor Dodig said he expects, “in the very short to medium-term, you’re going to have episodic inflation. You’re going to see it flare up in some sectors ... and then it may ebb again.” The bigger issue, he added, “is longer-term: How do we build an economy that actually has the capacity to grow?”


CPPIB RESTRUCTURES LARGEST INVESTMENT GROUP AND PARTS WAYS WITH GROUP LEADERS EARLY IN NEW CEO’S TENURE

G&M - Tim Kiladze (2021-04-09)

The investment arm of the Canada Pension Plan is restructuring its largest group by assets, according to internal memos, marking the fund manager’s first substantial changes under newly appointed chief executive officer John Graham.


CANADIAN COMPANIES ECHO U.S. TREND AS DIVIDENDS BACK ON THE RISE

G&M - David Milstead (2021-04-08)

Canadian companies have accelerated their payouts to shareholders, restoring dividends over all back to levels seen before the pandemic ushered in a wave of reductions and suspensions. Similar trends were seen in the United States.


VENDASTA TECHNOLOGIES IPO STRUGGLES TO SELL, SOURCES SAY, AS CANADA’S TECH CRAZE SUBSTANTIALLY COOLS

G&M - TIM KILADZE SEAN SILCOFF (2021-04-08)

Investor demand for Canadian technology IPOs is waning, making it tough for Vendasta Technologies Inc. to sell its $100-million initial public offering.


CANADA M&A SETS RECORD FOR QUARTER ON CROSS-BORDER DEALS, EASY MONEY

FP - Maiya Keidan (2021-04-08)

“These are definitely the busiest times I’ve seen in my 25-year career,” said Grant McGlaughlin, partner at law firm Fasken. “I don’t think you can last at this pace for the whole year but hopefully Q2 and Q3.”


CANADA'S BIG BANKS AMID BLISTERING HOUSING MARKET: STOP US BEFORE WE LEND AGAIN

FP - Terence Cocoran (2021-04-08)

When it comes to woke corporations, no Canadian institutions can match Canada’s big banks. Pick a subject dear to the trembling hearts and scheming minds of stakeholder capitalists and you will find that the banks are all over it — racial and gender diversity, climate and carbon issues, social responsibility, net-zeroism, charitable giving, COVID guidance. In the upper echelons of the bank towers of our major cities, bank executives have moved in on these areas as part of their mission to provide Canadians with “thought leadership.”


SHARES LIFTED TO RECORD HIGHS BY LOCKDOWN EASING, BENIGN FED

Reuters - Huw Jones (2021-04-08)

“In terms of economic re-opening, there is enough optimism built in at the moment to drive markets quite a bit higher from here, and the Fed has reiterated it’s going to remain on hold for a while,” Hewson said.


JPMORGAN CEO DIMON SEES U.S. ECONOMIC BOOM THROUGH 2023

Reuters - Elizabeth Dilts Marshall (2021-04-08)

As head of the biggest U.S. bank, Dimon is widely seen as the face of America’s banking sector, and he used the letter to share his views on the country’s economic health and to press for policies to help address inequality and improve the criminal justice system.


YELLEN SAYS TAX PLAN RECOUPS $2 TRILLION IN OVERSEAS PROFITS

Bloomberg - Christopher Condon and Laura Davison (2021-04-08)

Treasury Secretary Janet Yellen unveiled a detailed sales pitch for the Biden administration’s proposed new corporate-tax code, a plan that she said would be fairer to all Americans, remove incentives for companies to shift investments and profit abroad and raise more money for critical needs at home.


CHINA REVIVES $3 BILLION SALE OF RESCUED INSURER DAJIA

Bloomberg - Manuel Baigorri and Vinicy Chan (2021-04-08)

China is reviving a sale of Dajia Insurance Group Co., the company that took over most of the operations of troubled Anbang Insurance Group Co., as the government seeks to turn the firm over to private investors, according to people with knowledge of the matter.


CREDIT SUISSE IGNORED WARNINGS BEFORE ARCHEGOS AND GREENSILL IMPLODED

WSJ - Margot Patrick, Julie Steinberg, Juliet Chung and Duncan Mavin (2021-04-08)

Credit Suisse Group AG’s double-barreled financial crisis shares a common theme: a bank that looked the other way when warning signs argued for pulling back on lucrative corners of its business.


AFTER WIRECARD, GERMANY’S PROPOSED AUDIT OVERHAUL WORRIES FINANCE EXECUTIVES

WSJ - Nina Trentmann (2021-04-08)

Auditors and finance chiefs of some of Germany’s biggest businesses are worried that a new regulatory proposal intended to improve audit quality in the wake of the Wirecard AG scandal will lead to higher costs and less competition.


JAMIE DIMON SAYS JPMORGAN WON’T GO REMOTE AFTER THE PANDEMIC

WSJ - Marie Beaudette (2021-04-08)

JPMorgan Chase CEO Jamie Dimon said many of the bank’s roughly 250,000 employees will come back to the office after the pandemic. 


FIGHTING THE COVID-19 PANDEMIC LED TO RISING NATIONAL DEBT. NOW WHAT?

WSJ - WSJ Video (2021-04-08)

The federal government has been borrowing a lot of money to fight the pandemic. But with national debt rising, lawmakers disagree on how to deal with that debt and pay for priorities going forward. WSJ’s Gerald F. Seib explains. Photo illustration: Emma Scott


LACK OF SUPPLY DRIVING CANADIAN REAL ESTATE PRICES HIGHER? “PUHLEEZE”, SAYS BMO

Better Dwelling - Daniel Wong (2021-04-08)

Supply and demand-driven price growth only works with rational players. Currently, market mechanics are broken due to panic-driven purchasing. Fear is not a fundamental. “The only way in which supply is weak is in comparison to white-hot demand,” says Porter. 


VERSABANK RECEIVES INVESMENT GRADE CREDIT RATINGS: “A” OVERALL AND “A-” SUB-DEBT RATINGS TRANSFORM LOW-COST DEPOSIT OPPORTUNITIES

VersaBank - Press Release (2021-04-08)

The overall “A” rating for VersaBank by a National Association of Insurance Commissioners (NAIC)-recognized ratings agency significantly expands VersaBank’s universe of potential depositors, allowing the Bank to offer a very attractive deposit alternative to institutions such as insurance companies and named municipalities, among others, in Canada and internationally, who typically hold deposits for longer terms and are restricted to holding deposits with investment-grade rated financial institutions.


OSFI PROPOSES NEW MINIMUM QUALIFYING RATE FOR UNINSURED MORTGAGES

OSFI - OSFI (2021-04-08)

OSFI is seeking input from interested stakeholders on this proposed qualifying rate by email to B.20@osfi-bsif.gc.ca before May 7, 2021. OSFI will communicate final amendments to the qualifying rate for uninsured mortgages in Guideline B-20 by May 24, 2021, with a coming into force date of June 1, 2021.


AVIVA CANADA’S CEO SAYS PANDEMIC INSURANCE COVERAGE IS NOW A THING OF THE PAST

G&M - Clare O'Hara (2021-04-07)

Pandemic insurance will most likely become a thing of the past after the experiences of the COVID-19 outbreak, says Aviva Insurance Company of Canada’s chief executive Jason Storah.


TORONTO’S OFFICE VACANCY RATE HITS HIGHEST LEVEL SINCE 2008 FINANCIAL CRISIS

G&M - Rachelle Younglai (2021-04-07)

Toronto’s downtown office vacancy rate hit 9.1 per cent in the first quarter of this year, as more businesses tried to get rid of their office space after months of work-from-home mandates.

The vacancy rate was nearly two percentage points higher than the fourth quarter of last year, marking the highest level since early 2008 when the global financial crisis led to a vacancy rate of 9.5 per cent, according to a new report from commercial real estate firm CBRE.

An increase in space available to sublet is driving the vacancy rate higher. Bay Street firms such as Mercer Canada, Citco and TMX Group 

X-T +0.96%increase   , and dozens of others with offices in downtown Toronto, have been trying to sublease part of their existing space as a way to cut costs as the bulk of their office staff has been away from the office for nearly one year.


TORONTO MARCH HOME SALES, PRICES BLOW PAST RECORD SET DURING THE 2016 REAL ESTATE BOOM

G&M - Rachelle Younglai (2021-04-07)

There were 15,652 home resales last month, according to the Toronto Regional Real Estate Board (TRREB). That was nearly double the volume of March, 2020, when initial pandemic measures halted open houses and abruptly depressed sales and prices.


CI FINANCIAL AND INDUSTRY VETERANS CO-LAUNCH REAL ESTATE INVESTMENT FIRM

G&M - Clare O'Hara (2021-04-07)

The new venture will now allow retail investors access to private real estate opportunities that are typically hard to access, said Mr. Varghese, who managed a multibillion-dollar portfolio of global real estate equities at CI Global Asset Management for more than a decade.


BEWARE THE SIREN SONG OF MODERN MONETARY THEORY

FP - Mark Zelmer (2021-04-07)

The massive increase in government spending in Canada and around the world in response to the COVID-19 pandemic has been accompanied by a siren song in the form of a new economic theory: “Modern Monetary Theory,” or MMT for short. But as we begin to emerge from the acute phase of the pandemic we need to turn a deaf ear to that song. Now that inflation concerns are beginning to stir it is hard to imagine governments raising taxes or cutting spending anytime soon to keep inflation in check — yet that’s how MMT advocates would control inflation, with what traditionally have been regarded as fiscal policies rather than the customary monetary tools of interest rates and liquidity measures.


LIGHTSPEED LAUNCHES LIGHTSPEED PAYMENTS IN UNITED KINGDOM AND EUROPE IN EXPANSION OF TAILORED FINANCIAL SOLUTIONS

Cision - Press Release (2021-04-07)

Lightspeed Payments will be rolled out to hospitality merchants in the United Kingdom, followed by retail. This will continue for Lightspeed merchants throughout FranceBelgiumthe NetherlandsGermany and Switzerland. The United Kingdom is an underserved market when it comes to payments, especially in the hospitality sector, and Lightspeed is thrilled to support these businesses as they begin to re-open for full-capacity dining. 


BANXA REPORTS 793% YEAR-ON-YEAR INCREASE IN TOTAL MARCH QUARTER TRANSACTION VALUE

Cision - Press Release (2021-04-07)

BANXA, a Payment Service Provider (PSP) with a mission to build the bridge between traditional financial systems, regulation and the digital asset space has announced it's Total Transaction Value (TTV) results for the month of March 2021. The company recorded $79.5 million AUD in total transactions, up 13% since last month ($70.4 million) and up 696% on the same reporting period in March 2020. This brings the TTV for Jan-Mar 2021 quarter to $205 million AUD. This is a 793% increase from Previous Corresponding Period (PCP). Banxa also reported over $400 million in TTV for the nine month period ended March 31.


YELLEN GLOBAL MINIMUM TAX IS STEP TOO FAR IN D.C

Reuters - Gina Chon (2021-04-07)

That would put America’s headline rate above many Western nations. Biden’s blueprint also includes a minimum tax of 21% on the income U.S. companies earn on assets like patents and trademarks outside the United States, up from the current floor of around 10%.


SHOULD PAYPAL BE WORRIED ABOUT YOUR COUNTRY’S CENTRAL BANK?

Bloomberg - Andy Mukherjee (2021-04-07)

The world of money is about to leap into the great unknown of central bank digital currencies. Will it land in a utopia of universal financial inclusion or crash into a dystopia of instability? Perhaps the experiment will upend banking as we know it, or turn out to be one big damp squib, unable to compete even with an existing private network like PayPal Holdings Inc.?


JPMORGAN CEO JAMIE DIMON SEES ‘GOLDILOCKS MOMENT’ FOR U.S. ECONOMY

WSJ - Orla McCaffrey (2021-04-07)

The leader of America’s biggest bank said the U.S. economy is emerging from the coronavirus pandemic into a boom that could last until 2023.


A LARGE CANADIAN BANK JUST BLAMED THE BANK OF CANADA FOR THE PROPERTY BUBBLE

Better Dwelling - Daniel Wong (2021-04-07)

Robert Kavcic sent clients a housing analysis this morning. He attributes the transition from a hot market to one that’s going to burn down the economy, to a promise of low for long interest rates. The promise has been made directly by the BoC, in multiple attempts to calm households. Instead, it accidentally caused a surge of FOMO-driven panic buying.


CANADIAN REAL ESTATE TO COOL LATER THIS YEAR, “NO URGENCY” FOR MEASURES: SCOTIABANK

Better Dwelling - Daniel Wong (2021-04-07)

The Big Six bank believes policymakers shouldn’t touch the market, because it will fix itself. The bank is joining the country’s central bank in the belief this is a temporary issue. By the end of the year, they see rising inventory levels and normalized demand cooling the market. A rise in inventory would remove the pressure on prices to rise further.


$4.7B FLOWED INTO CANADIAN ETFS IN MARCH

Investment Executive - Mark Burgess (2021-04-07)

“[T]he inflows into mid- and small-cap ETFs have accelerated month over month in 2021, bringing this category’s Q1 total net flows to $374 million, or 29% of 2020’s year-end AUM,” the report said.


SHUTTERING OF NATIONAL SECURITIES REGULATOR CAME AS NO SURPRISE TO INDUSTRY

Investment Executive - Rudy Mezzatta (2021-04-07)

Last week, the CMAIO, which was established in 2015 to guide the launch of a national capital markets regulatory authority, put its operations on pause and laid off its staff. The organization said that it could resume its work in the future “when there is greater certainty around cooperative system launch timelines.”


CANADA’S Q1 DOWNTOWN OFFICE VACANCY RATE RISES TO 14.3%

Investment Executive - CP (2021-04-07)

CBRE says Montreal, Toronto and Vancouver’s downtown office vacancy rates hit 10.6, 9.1 and 6.2% respectively in the latest quarter, up from 6.4, 2 and 2.2 at the same time last year.


GET READY TO SHOW YOUR WORK UNDER THE CLIENT-FOCUSED REFORMS

Investment Executive - David Reeve (2021-04-07)

In Canada, the client-focused reforms (CFRs) will create a heightened standard of “best interest” conduct for advisors and their dealers. A similar regulation in the U.S. — Regulation Best Interest (Reg BI) — also imposes new standards of conduct on advisors dealing with retail clients. Both the CFRs and Reg BI are principles-based, and most wealth firms are interpreting the new rules, developing compliance strategies and evaluating technology solutions that support their plans.


GM CANADA STRIKES DEAL TO OFFLOAD $1.8-BILLION IN EMPLOYEE PENSIONS

G&M - Davide Milstead (2021-04-07)

General Motors Canada 

GM-N -1.79%decrease   has closed a deal for three insurance companies to take on $1.8-billion of its retiree pension obligations, the largest transaction of its kind in the country’s history.


CIBC SAYS MOST EMPLOYEES WON’T RETURN TO THE OFFICE BEFORE SEPTEMBER

G&M - James Bradshaw (2021-04-07)

Canadian Imperial Bank of Commerce will keep most of its employees who are currently working remotely away from offices until at least September, pushing back plans to return staff to the workplace.


CITI WARNS MARKETS EERILY SIMILAR TO WHAT PRECEDED THE 2000 CRASH. PLUS, COVID-19 LESSONS FROM AN INCOME PROPERTY INVESTOR

G&M - G&M (2021-04-07)

Citi’s chief U.S. equity strategist Tobias Levkovich does not like this market at all. In Wednesday’s Feeling a 1999 Vibe (and That’s Risky), the strategist directly compares current market euphoria to the last months before the collapse of the 1990s technology bubble.


BANK REGULATOR RESTARTS CONSULTATIONS ON OVERHAULING MORTGAGE STRESS TEST AFTER PANDEMIC INTERRUPTION

G&M - Rachelle Younglai (2021-04-07)

Canada’s bank regulator said it will take another crack at changing the mortgage stress test that determines whether borrowers qualify for a home loan.


IF YOU SELL A HOUSE THESE DAYS, THE BUYER MIGHT BE A PENSION FUND

WSJ - Ryan Dezember (2021-04-07)

A bidding war broke out this winter at a new subdivision north of Houston. But the prize this time was the entire subdivision, not just a single suburban house, illustrating the rise of big investors as a potent new force in the U.S. housing market.


BMO CEO DARRYL WHITE URGES REGULATORS TO PREPARE MEASURES TO COOL THE HOUSING MARKET

G&M - James Bradshaw (2021-04-07)

The chief executive of Bank of Montreal says policy makers and regulators should “plan urgently” in case they need to step in to help cool overheating housing markets – but adds that they should wait and see what happens in the coming weeks.


YES, BANK DIVIDEND HIKES ARE COMING. NO, NOT YET

G&M - Staff (2021-04-06)

The prohibition on bank dividend increases and share buybacks – which the Office of the Superintendent of Financial Institutions introduced in March, 2020 – remains in place, John Heinzl writes. But there’s reason for optimism: With banks carrying large amounts of excess capital and vaccinations ramping up, a resumption of dividend hikes may not be far off.


RAPID INCREASE IN HOME PRICES PUTS BUYERS IN BIND WHEN APPRAISALS DON’T MATCH SALE PRICE

G&M - James Bradshaw (2021-04-06)

An appraisal is a key factor when a bank or credit union decides how much it can lend against a particular home. It is a snapshot of what that home is worth at a moment in time – and a check on exuberance, based on data of recent sales that have closed.


'LET'S BUILD ANOTHER 15 SHOPIFYS': NEW HEAD OF LEADING INCUBATOR SAYS MOMENT IS RIPE FOR CANADIAN TECH

FP - Bianca Bharti (2021-04-06)

Canada needs to foster companies that can compete on a global scale if it wants to build a sustainable technology ecosystem, according to the incoming chief executive of one of the country’s top tech incubators.


JANET YELLEN CALLS FOR GLOBAL MINIMUM CORPORATE TAX TO END '30-YEAR RACE TO THE BOTTOM'

FP - Reuters (2021-04-06)

Yellen said it was important to make sure governments “have stable tax systems that raise sufficient revenues in essential public goods and respond to crises, and that all citizens fairly share the burden of financing government.”


DON'T BE ALARMED AS THE BANK OF CANADA BEGINS ITS COVID WITHDRAWAL

FP - Steve Ambler, Jeremy M. Kronick and William B.P. Robson (2021-04-06)

On March 23, the Bank of Canada announced the upcoming suspension of some of its major asset-purchase programs. This is good news. Financial stresses at the beginning of the pandemic a year ago led the bank to buy the debt of provincial governments and private companies. Those stresses are now in the past and Canadians should welcome the bank’s retreat from a role fraught with economic and political risks.


CREDIT SUISSE OVERHAULS MANAGEMENT AS IT TAKES $4.7 BILLION HIT ON ARCHEGOS

Reuters - Brenna Hughes Neghaiwi, Matt Scuffham (2021-04-06)

The scandal-hit bank now expects to post a loss for the first quarter of around 900 million Swiss francs. It is also suspending its share buyback plans and cutting its dividend by two thirds.


BYTEDANCE SAYS INDIA'S FREEZE ON BANK ACCOUNTS IS HARASSMENT - COURT FILING

Reuters - Abhirup Roy, Aditya Kalra (2021-04-06)

An Indian tax intelligence unit in mid-March ordered HSBC and Citibank in Mumbai to freeze bank accounts of ByteDance India as it probed some of the unit’s financial dealings. ByteDance has challenged the freeze on the four accounts in a Mumbai court.


SCOTIABANK IS CAUTIOUS ON CANADA HOUSING AS RBC, BMO SEEK ACTION

Bloomberg - Shelly Hagan and Erik Hertzberg (2021-04-06)

Bank of Nova Scotia, Canada’s third-largest lender, waded into the burgeoning debate over whether Justin Trudeau’s government should take immediate steps to cool the nation’s hot housing market, issuing a report that cautioned against rushing to implement new constraints.


TORONTO HOME-PRICE SURGE TOPS 20% AS BUBBLE DEBATE HEATS UP

Bloomberg - Ari Alstedter (2021-04-06)

New listings were up 57% from March 2020, when the onset of the pandemic temporarily caused a freeze in real estate activity. But the new supply was not able to keep up with demand spurred by low borrowing costs and demand for bigger homes, especially in the suburbs, a report from the Toronto Regional Real Estate Board said Tuesday.


HUNGARY SEEKS TO BE FIRST IN EU TO JOIN RUSSIA-LED REGIONAL BANK

Bloomberg - Veronika Gulyas (2021-04-06)

Hungary is seeking to become the first European Union nation to join the Moscow-based Eurasian Development Bank, according to Foreign Minister Peter Szijjarto.


HOW QUANTITATIVE EASE INFLATES REAL ESTATE PRICES, AND WHY IT DOESN’T WORK FOREVER

Better Dwelling - Stephen Punwasi (2021-04-06)

Quantitative ease (QE) is when central banks, like the BoC and the Fed, buy bonds or mortgage securities. These state players, with unlimited capital, create demand for these debt instruments. By creating demand, they drive the price up, and the yields on these instruments. Yield is another way of saying the return on capital lent, or the percent paid to you. 


SOARING BOND YIELDS LIFT DB PENSION SOLVENCY TO HIGHEST LEVEL IN 20 YEARS

Investment Executive - IE (2021-04-06)

“In March 2020, as markets were experiencing a gut-wrenching freefall, nobody would believe that pension plans would be breaking funded position records only a year later,” Ben Ukonga, principal in Mercer’s financial strategy group, said in a statement.


BIDEN’S PLAN TO RAISE CORPORATE TAXES IN THE U.S. COULD IMPACT CANADIAN BANKS

G&M - James Bradshaw (2021-04-05)

Some of Canada’s largest banks are facing higher tax bills if U.S. President Joe Biden’s administration raises corporate tax rates, but analysts say any hit to earnings could be offset by other economic tailwinds.


FORMER CENTRAL BANK GOVERNOR TO PLAY PROMINENT ROLE AT LIBERAL CONVENTION

G&M - Joan Bryden (2021-04-05)

Mark Carney, long touted as a potential Liberal leader one day, will be a keynote speaker at the federal party’s convention later this week.


IT'S NOT JUST TORONTO AND VANCOUVER — CANADA'S HOUSING BUBBLE HAS GONE NATIONAL SOCIAL SHARING

CBC - Pete Evans (2021-04-05)

"We thought, 'Well, jeepers, maybe we should go for it now," Armstrong said. The couple listed their home in mid March. Thirty-five viewings later, they had 11 offers on the table. She says she feels like they won the lottery.


SHARE ON TWITTER OPEN MORE SHARE OPTIONS BREADCRUMB TRAIL LINKS NEWS ECONOMY TD BANK CEO PUSHES FOR POLICIES TO SPUR CASH-FLUSH CONSUMERS TO SPEND LOCALLY

FP - Geoff Zochodne (2021-04-05)

“Second, with economies showing strong signs of recovery, we should adopt policies to encourage consumers to spend pent-up demand in local economies and support small and mid-sized businesses as they rebuild,” he told shareholders during his bank’s virtual annual meeting.


MOUNTING DEBT 'WORRYING' AS CANADIANS STRETCH TO CHASE RISING HOME PRICES, SAYS BANK OF CANADA GOVERNOR

FP - Bianca Bharti (2021-04-05)

“If you look at the household indebtedness, you are seeing, on average, the loan-to-value ratios are getting higher, particularly in the uninsured space. That suggests that Canadians are stretching and that is worrying.”


FROM HOUSEBUILDERS TO TOYMAKERS, BUSINESSES ARE SOUNDING THE INFLATION ALARM

FP - Aziza Kasumov, Colby Smith (2021-04-05)

“Costs are going up everywhere,” said Ted Doheny, chief executive of packaging maker Sealed Air Corp. “It’s DefCon 4 (for) us right now. It’s a big deal.”


CREDIT SUISSE SHARES RALLY WHILE ARCHEGOS RIPPLES SPREAD

Reuters - Takashi Umekawa, Oliver Hirt (2021-04-05)

Credit Suisse and Japan’s Nomura have borne the brunt of those losses, with the Swiss lender warning it could have a “material impact” on its profits, but details of who else was exposed to Hwang are still emerging.


A TRADITIONAL WALL STREET ADVANTAGE IS SUDDENLY BEING THREATENED

Bloomberg - Charlie Wells, Katharine Gemmell, and Suzanne Woolley (2021-04-05)

Trading startups Robinhood Markets and Social Finance are looking to offer clients the chance to buy IPO shares early, instead of after they hit the market. Companies planning to go public — like London-based delivery app Deliveroo, which debuted Wednesday — are giving customers access to pre-IPO stock. And fast-growing blank-check firms known as SPACs are a back-door way for some individual investors to get in on an IPO.


DON’T LET CHINA MINT THE MONEY OF THE FUTURE

Bloomberg - Niall Ferguson (2021-04-05)

What is the money of the future? My nine-year-old son thinks it will be Robux. For those of you trapped in the human museum known as adulthood, Robux is the currency used by players of Roblox computer games. If I offer Thomas grimy dollar bills for household chores, he shows an almost complete lack of interest and motivation. But if I offer him Robux, it’s a different story.

The current exchange rate is around 80 to the dollar. So, in order to incentivize my son to do the dishes, I need to go online and buy 2,000 Robux for $24.99. This I do by entering my credit card details on a website, an act of self-exposure that never fails to make me feel sick. However, the dishes get cleaned and, later, my son blows some of his Robux on a cool new outfit and a pair of wings for his avatar, earning the admiration of his friends. Robux is just one of the new forms of money that exist in the parallel world of online gaming. If your kids play Fortnite, then you’ve probably had to buy them V-Bucks (short for VinderBucks). And gamer money is, in turn, just a subset of the myriad means of payment that now exist on the internet.
Meanwhile, as Bitcoin has grown more respectable, the cool kids have moved on to decentralized finance (“DeFi”), “an open, permissionless, and highly interoperable protocol stack built on public smart contract platforms” such as the Ethereum blockchain, to quote a recent and excellent St. Louis Fed paper by Fabian Schaer. Like Bitcoin, DeFi has no centralized third-party system of verification and regulation. But it is a much looser, more variegated system, with multiple coins, tokens, exchanges, debt markets, derivatives and asset management protocols. As Schaer puts it:


CANADIAN REAL ESTATE OVERVALUED, TORONTO NEEDS A 28% CORRECTION FOR FAIR VALUE: IMF

Better Dwelling - Better Dwelling (2021-04-05)

Greater Toronto residential real estate is massively overvalued, according to the global agency. The observed price of a home in the region reached $934,793 in Q2 2020. The attainable value for the same period only measures $671,154. In case you missed the gap between the two, it’s huge. 


CANADIAN ESTATE PRICES ARE THE MOST OVERVALUED IN THE G7, SHOWS ANOTHER INDICATOR

Better Dwelling - Daniel Wong (2021-04-05)

Rental costs are closely tied to wages, with growth limited to what local incomes can support. You can’t easily charge a whole country 20% more rent, if wages are only growing at 2-3%. Home prices however, reflect how much credit the marginal buyer is able to consume. If home prices rise much more than rent, it’s often due to easy credit conditions — not fundamentals.


RBC COMPLETES SALE OF EASTERN CARIBBEAN OPERATIONS

Investment Executive - IE (2021-04-05)

“This transaction will allow RBC to align investments and resources into markets where our vision for being the Caribbean’s digitally enabled relationship bank can be executed most successfully,” said Rob Johnston, head of Caribbean banking, in a release.


CALLING ALL NIGHT OWLS: MX LOOKS TO FILL EXPANDED TRADING HOURS

Investment Executive - James Langton (2021-04-05)

The MX is looking for firms to make markets in S&P/TSX 60 index futures, government of Canada bond futures (two-, three-, and five-year maturities), and Canadian Bankers’ acceptance futures during its new Asian trading hours, which will run from 8:00 pm ET to 2am ET.


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THE HOUSING BOOM THAT NEVER ENDS ALREADY WIPED OUT ALL THE SHORT-SELLERS

Bloomberg - Ari Altstedter and Kevin Orland (2021-06-15)

Normally this kind of quick-buck speculation would be interpreted by economists, policy makers and finance types as the indisputable sign of a housing bubble. But Moore has been a professional house flipper in the Toronto area for more than a decade now, during which a seemingly endless line of illustrious doomsayers have taken the other side of his bet on real estate in word and deed, only to be proven wrong.

One of the earliest was Mark Carney, then Canada’s central bank governor but soon to take over the Bank of England, who called the country’s reliance on housing wealth “ unsustainable” back in 2012. Then came the wave of American financiers, one after the other, whose collective bet on a Canadian housing crash got its own nickname, “The Great White Short.” Many of them, like Steve Eisman of The Big Short fame, applied the lessons they had learned in the bursting of the U.S. housing bubble years earlier.


END OF AN ERA AS POLOZ EXITS BANK OF CANADA

G&M - DAVID PARKINSON (2021-06-01)

Stephen Poloz had only been Governor of the Bank of Canada for a few months in the late summer of 2013, when he gave a speech that defined his unique communication style and signalled a new era for a traditionally staid institution.


CANADA’S ANTI-MONEY LAUNDERING AGENCY STRUGGLES TO IMPLEMENT REFORMS AS EMPLOYEES WORK FROM HOME

G&M - Vanmala Subramaniam (2021-04-15)

Internal documents from the Financial Transactions and Reports Analysis Centre of Canada (FinTRAC) obtained through freedom of information legislation paint a picture of substantial disruption at the agency, especially in the first few months of the pandemic, when hundreds of employees were abruptly forced to work from home.


BORIS WERTZ’S VERSION ONE VENTURES WINS BIG AS COINBASE SHARES SOAR IN DEBUT

G&M - Sean Silcoff, Vanmala Subramaniam (2021-04-15)

Version One, led by Boris Wertz and Angela Tran, invested US$2-million across two private financings of Coinbase in 2017 and 2018, picking up about 151,000 shares. Both investments were made from its $35-million (US$28-million) second venture fund.


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