Briefly:

(February 24, 2006) Saxon Mutual Funds has announced it will introduce F class units for most of its fund mandates to address the firm’s “rapidly growing” presence among fee-based advisors. The F class units are expected to be available for sale to advisors in June.

Saxon funds are available through advisors, although the firm may be best known for its direct marketing strategy and availability through discount brokerages. Saxon offers nine funds, managed by Howson Tattersall Investment Counsel, a wholly owned subsidiary of Saxon.

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CI adds features to Global High Dividend fund

(February 24, 2006) CI Investments has announced new features for its Global High Dividend Advantage Fund, including a right to “free redemption” for standard deferred sales charge units.

The fund is now available in front-end load, DSC and low-load formats and investors may now switch from the fund to other CI funds. The added features bring the fund in line with CI’s other funds.

Optional features include the Personal Asset Allocation Program and systematic transfer and withdrawal programs. CI has also taken management of the fund in-house, with the former manager, Epoch Investment Partners, contracted to notional baskets of securities on behalf of counterparties with whom the fund will enter into forward agreements.

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Northern Securities expands private client group

(February 24, 2006) Northern Securities has announced the hiring of five professionals for its Private Client and Capital Markets Groups.

“We are pleased with the progress and continued expansion of our Private Client Group across Canada,” said George Garner, Executive Vice President, Private Client Group. “It is our belief that a need exists for a securities firm that caters to the needs of financial professionals who are looking to build and manage their business in a flexible, supportive environment. Northern provides that environment.”

The new hires for the Private Client Group include Ed Gougeon in Ottawa, Darrell Jahma and Mel Puchailo in the Calgary office and Ron Whitney in the Edmonton office. Michael McGuin joins the Capital Markets Group in Toronto.

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Raymond James selects Toogood Systems

(February 24, 2006) Raymond James has signed a deal with Toogood Financial Systems, to receive investment management, performance measurement, reconciliation and client reporting services.

“Toogood offers the flexibility for our financial advisors to provide customized advice to meet their specific needs,” says Julian Smith, senior vice president of Raymond James’ private client group. “It is an innovative and functionally rich portfolio management solution that can grow to meet our needs as we build our platform of excellence.”

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Seneca College offers elder planning designation

(February 24, 2006) The Canadian Initiative for Elder Planning Studies (CIEPS) has teamed up with Seneca College’s Centre for Financial Services to offer the Elder Planning Counselor designation (EPC) for professionals working with clients over the age of 50.

“The need for education and training in elder financial planning issues is exploding. CIEPS is a recognized leader in the production of materials in this growing area and we are pleased to be working together to deliver this program to the wider population to meet growing needs,” says Gary Butler, Director of The Centre for Financial Services at Seneca College.

The designation is not exclusive to the financial services industry, as it has been conferred upon lawyers, doctors and social workers.

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MFDA bans Toronto mutual fund rep

(February 23, 2006) The Mutual Fund Dealers Association has banned Stephen Headley for life and fined him $150,000 — $5,000 less than the money he stole from clients.

The MFDA says over a one-year period Headley took approximately $155,000 from two clients. Headley, who was based in Toronto, compounded his troubles when he failed to provide information requested by the regulator when it was investigating the complaint. The first allegation warranted a $100,000 fine and his failure to cooperate with the association resulted in an additional $50,000 fine.

Headley is also expected to pay costs for the investigation of $7,500. It is not clear whether Headley will pay since the MFDA does not have any power in Ontario to collect on the fine after a representative has left the industry.

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Northwest to re-open small cap fund

(February 23, 2006) Northwest Mutual Funds says it will re-open the Northwest Specialty Equity Fund, effective February 24.

In addition, Montrusco Bolton Investments has been hired to take over management responsibilities for a portion of the fund. Montrusco is also the portfolio advisor to the Northwest Specialty Growth Fund.

The current lead portfolio advisor on the specialty equity fund, Deans Knight Capital Management, will eventually manage approximately one-third of the portfolio. All new money will go to Montrusco, and some current assets may be shifted to Montrusco to achieve this split of responsibilities, Northwest says. The fund’s investment objectives will not change.

“The Northwest Specialty Equity Fund was closed in January 2005 in the best interests of unitholders, and it is being re-opened for the very same reasons,” says Northwest president Michael Butler.

Northwest says the fund will be capped again when assets — currently at $239 million according to Morningstar Canada — reach $500 million.

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Actively managed funds lag their indices

(February 23, 2006) Despite the fees fund managers collect, few seem to add value, a new report suggests. Only about one in ten actually manage funds that outperform the S&P/TSX Composite Index, according to Standard & Poor’s.

Managers in the U.S. fare slightly better, with the S&P 500 outperforming managers almost 60% of the time in 2005. The data is from the S&P Indices Versus Active Funds Scorecard (SPIVA), a measure of funds’ performance versus their appropriate index.

Actively managed Canadian small-cap funds are the only managers who seem to add true value in their stock picking since more than 60% of them beat the S&P/TSX SmallCap Index last year. “Active managers of the Canadian small-cap funds have had a better chance of beating their respective benchmarks, which is commonly believed to be a result of the relatively inefficiency of the market,” says Jasmit Bhandal, director of S&P’s business development.

The S&P findings are nothing new. In the last five years less than one-third of Canadian equity funds have beat the TSX. In the past three years that number drops to about 8%. The track record of U.S. funds over time isn’t much better, since 2002 only 32% of them beat the S&P 500.

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Counsel Wealth Management renames fund

(February 23, 2006) Counsel Wealth Management has changed the name of its Counsel Managed Fund to Counsel Managed Portfolio.

Counsel has six such funds, which are known as Counsel Portfolios, including Counsel Conservative Portfolio, Counsel Balanced Portfolio, Counsel Regular Pay Portfolio, Counsel Growth Portfolio and Counsel All Equity Portfolio.

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Qtrade replaces portfolio manager

(February 23, 2006) Qtrade Fund Management has replaced its portfolio manager for the QFM Funds. OceanRock Capital Partners will take over from Cornerstone Investment Counsel.

Qtrade, a division of Vancouver-based Qtrade Financial Group, provides investment and wealth management services to over 175 financial institutions. There is no way to gauge on the impact of the change since the funds are too new to report any performance data.

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B.C. increases small business tax credit

(February 22, 2006) B.C. has raised the Small Business Venture Capital tax credit program to $25 million from $20 million, part of a handful of tax changes introduced in the provincial budget.

Tuesday’s budget also eliminates provincial sales taxes on maintaining or modifying computer software and extends the B.C. Mining Flow-Through Share Tax Credit to maintain an incentive for raising venture capital mineral exploration in the province.

The province is spending more than $300 million over four years to boost the Home Owner Grant Program. The basic grant will increase by 22% to $570 and to $845 for seniors, the disabled and veterans.

The threshold at which homeowners qualify for the full grant will increase to $780,000 in assessed value, ensuring that more than 95% of homeowners remain eligible for the full grant, the province says.

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Caisse, RBC to work together on succession planning

(February 22, 2006) Quebec’s Caisse and RBC have signed an agreement intended to help Quebec business owners handle issues related to succession planning.

Under the agreement, advisors at RBC and the Caisse will work closely to advise and support business owners who wish to transfer their business to family members or company managers, the two financial institutions said in a release.

“RBC has more than 80,000 business clients of all sizes across Quebec,” said RBC’s Francois Armand. “Many owners will want to pass the torch to the next generation of entrepreneurs in the coming years. Thanks to this agreement with the Caisse, we will be in a position to offer them financial services tailored to the specific needs of their business ownership transfer, along with credit instruments and equity capital.”

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Health issues could create labour shortage, says StatsCan

(February 22, 2006) Canadians nearing retirement are generally in good health, according to Statistics Canada, however a significant number have been forced to leave the labour force due to health-related reasons.

In 2003, nearly half-a-million Canadians between the ages of 50 and 69 were not working because of health issues.

“Their loss is important because of rising concerns over a labour shortage in coming years as the baby boom generation nears retirement and the growth in Canada’s population slows,” the agency said a report released on Wednesday.

Chronic conditions such as arthritis and rheumatism, high blood pressure and back problems were the most common ailments among those who left the work force.

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RBC to close pooled fund

(February 22, 2006) RBC Asset Management says it will terminate the RBC Private U.S. Equity Pool effective April 28, 2006, citing the fund’s small size and the its limited growth potential.

The pool will be closed to new purchases effective March 1, 2006. Unitholders and their advisors have until April 28 to redeem their units, at which time any remaining units will be automatically redeemed into cash, RBC says.

For Series F units, distributions will continue to be re-invested in units of the pool until April 28, unless other arrangements are made.

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RBC opens branch office in Beijing

(February 22, 2006) RBC has received approval from Chinese regulators to upgrade its office in Beijing to a branch, allowing RBC to offer more services to clients doing business in China.

The branch will open at the end of February, staffed by 16 employees, and will be able to provide institutional and business clients with a range of banking activities, including correspondent banking and trade finance, RBC says.

“More than fifty years ago, RBC became the first North American bank to offer correspondent banking services to institutions in the People’s Republic of China,” said RBC president Gordon Nixon. “With today’s announcement, we will be able to provide a broader range of banking services to our clients doing business in China, and to Chinese citizens planning to emigrate to Canada.”

The bank’s goal is to help new Chinese immigrants easily set up their financial affairs before they arrive in Canada, says RBC’s Mark Whitmell. “By having local RBC employees available in Beijing, we are making one part of the immigrating transition that much easier.”

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Commodity prices to remain buoyant

(February 21, 2006) BMO Financial Group expects commodity prices will cool slightly, but remain relatively buoyant in 2006. The BMO Commodity Price Index is projected to decline marginally by 1% during the year.

“The index will be maintaining its level close to last year’s all-time high throughout 2006,” predicts BMO Financial assistant chief economist Earl Sweet. “However this would represent a significant deceleration in the index’s momentum following average growth rates of 21% in the previous three years.”

The Index dropped 6.7% in January as a result of lower prices for natural gas and wheat. Some offset was provided by price increases in metals, minerals and forest products. The Oil & Gas Index suffered from a very steep drop in natural gas prices, but the effect was offset by a rise in crude oil. The Metals & Minerals Index rose 5.4% in January, thanks to solid gains in precious and base metals, including a notable 7.1% jump in the price of gold.

“Metal and mineral prices are generally expected to ease in 2006, although solid demand, low inventories and limited production growth should keep them close to previous year levels,” says Sweet.

The Forest Products Index, meanwhile, rose for a third straight month in January, posting a 1.6% gain. The advance was broadly based, with most components posting modest increases. The agricultural sub-index fell 2.3% during the month, as losses in wheat and soybeans, the result of increase competition in export markets and improved crop prospects in South America, offset gains in canola and corn.

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Saskatchewan labour fund managers optimistic

(February 21, 2006) Saskatchewan Labour Sponsored Venture Capital Corporation (LSVCC) managers say they are optimistic about the future and looking forward to building on the past two years of strong investment growth.

Saskatchewan residents invested $28 million last year in the province’s two labour funds, a 30% increase over assets invested in 2004 and 50% increase above the amount recorded in 2003. Managers say they are finding many different business opportunities in the province, including new ventures in ethanol, oil, gas and “value-add” companies.

The province’s Invest in Saskatchewan LSVCC program, including the SaskWorks Ventures Fund of Regina, and the Golden Opportunities Fund of Saskatoon, give investors up to 35% in tax credits, plus their RRSP deduction. Funds are used to invest in Saskatchewan companies to help them expand their operations in the province.

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PlanPlus teams up with Australian research firm

(February 21, 2006) PlanPlus is joining forces with Australia’s FinaMetrica to bring the firm’s web-based risk-profiling system to the Canadian market.

The initial launch will be a module integrated with PlanPlus Web Advisor, the two companies announced Tuesday in a release.

“The multi-country, multi-language capability of the PlanPlus Web Advisor makes it a world leader in planning software,” says FinaMetrica co-founder Geoff Davey. “The PlanPlus software integration strengthens our offering in our current markets and introduces us to new markets beyond our current scope — most important of which is Canada.”

“The FinaMetrica system is a world leader in risk profiling and in use by leading advisors in eight countries including the U.S. and the U.K. where we first became familiar with it,” adds PlanPlus president Shawn Brayman.

Existing PlanPlus Web Advisor users will have an option to subscribe to the FinaMetrica system and switch between the standard 10-question profile in Web Advisor and the more elaborate FinaMetrica profiling questionnaire.

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BC man barred from markets

(February 20, 2006) The British Columbia Securities Commission (BCSC) has barred a man from virtually all participation in the capital markets, after he admitted to stock manipulation.

Michael Alan Wilson, formerly registered salesperson, made two trades in Golden Fortune Investments securities in order to inflate the trading volume of the company. On top of being barred from the market, Wilson must pay $5,000 to the BCSC.

Golden Fortune was listed on the TSX Venture Exchange, but was delisted on April 20, 2004 for failure to file its annual financial statements in 2003.

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CIMBL applauds new Ontario Mortgage Act

(February 20, 2006) The Canadian Institute of Mortgage Brokers and Lenders (CIMBL) is applauding newly tabled legislation in Ontario, which, if passed, would establish a tiered registration system for mortgage brokers and agents.

“The current Act has not changed for nearly 30 years, while the mortgage industry has grown enormously in size and sophistication over the same time period,” said Ron Swift, AMP, president of CIMBL.

The newly tabled Mortgage Brokerages, Lenders and Administrators Act will also set out qualifications for practicing as a mortgage broker or agent.

(02/20/06)