Briefly:

(November 12, 2004) Rockwater Capital Corporation has agreed to buy KBSH Capital Management Inc., an acquisition that will add about $6.3 billion in assets under management.

“KBSH will serve as Rockwater’s key platform to drive participation in the consolidation of the asset management industry,” said William Packham, president and CEO of Rockwater. “KBSH is a scale business with talented people, strong client relationships, products, systems and brand. Over the next several years, we will continue to actively pursue acquisitions in asset management.”

The deal will see Rockwater paying $32.5 million in cash and it will issue approximately 30.3 million common shares, $21.75 million in preferred shares and $25 million in subordinate debt to KBSH shareholders.

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ASC posts operating loss

(November 12, 2004) The Alberta Securities Commission (ASC) has revealed a net loss of $935,000 for the latest quarter, ending September 30, 2004. That’s up from $896,000 for the same period last year. So far this year, the ASC has lost $871,000 compared to $492,000 in the prior period.

Expenses decreased over this quarter by $258,000, but at the same time, revenues tumbled by $297,000 from last year. On a year-to-date basis, revenues are $312,000 below budget, but expenses are below budget by $1,064,000.

The ASC says registration revenues were off by $295,000, due to the national registration system implemented April 1, 2003, which accelerated the collection of registration fees during the first two quarters of fiscal 2004. Salary and benefit costs increased by $171,000 due to a 3.5% salary adjustment and staff growth of two positions. The regulator expects to post a full-year loss of about $1,500,000.

By contrast, the Ontario Securities Commission posted a profit of $21 million on Monday.

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Credential takes top spot in online broker rankings

(November 12, 2004) Watchfire GomezPro has released its updated rankings for the best in Canadian online brokerages. The Q4 2004 Canada Online Brokerage Scorecard rates Credential Direct as the best overall site, displacing BMO InvestorLine, which fell to number three spot. CIBC Investor’s Edge ranked second.

“Given the evolution of investor needs and the rapid pace of change encouraged by leading online brokerage firms, faster development cycles and industry research are key to maintaining a competitive offering,” said Glenn LaCoste, Chief Consultant for Watchfire GomezPro Canada. “The introduction of advice-related tools and mainstream robust self-analytic trader tools and features has caused some shifts in the Scorecard position for some online brokerage firms.”

Credential Direct picked up points, thanks to its top ranking in its Life-Goal Planner profile and One-Stop Shopper profile as well as taking second in both the Active Trader and Serious Investor profiles.

Laurentian announces new appointments

(November 11, 2004) Laurentian Bank has hired a new vice-president and handed new responsibilities to the chief economist at the bank’s securities division.

Francois Barrrière, formerly of BNP Paribas Canada, has joined Laurentian as vice-president, business development, foreign exchange and international services.

“An MBA graduate, Mr. Barrière has earned an excellent reputation in the banking world,” Laurentian said in a release. “He has acquired nearly 20 years of expertise in financial markets, and has held several positions in which he demonstrated a range of outstanding skills and remarkable communication abilities.”

His new duties include developing business in foreign exchange and international services and acting as media spokesperson regarding exchange activities.

Laurentian also announced today that Carlos Leitao will assume the role of strategist in addition to his present position of chief economist at the bank’s securities division.

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Early retirement looking doubtful

(November 10, 2004) Canadians are becoming more skeptical of their early retirement plans and are worried that even part-time post-retirement employment may not provide them with the assets they need for a modest retirement, according to a survey by Desjardins Financial Security.

“All the publicity about the rising costs of medical and health care, and the reduced levels of provincial government support, has driven home the point that ill health can quickly erode a lifetime of frugal living,” says Monique Tremblay, senior vice-president, savings and segregated funds, Desjardins Financial Security. “Canadians now realize they need to save more money to pay for these types of expenses, before they retire. Fear of ill health may keep people in the workforce longer than everyone’s previous projections.”

The telephone survey found 60% of Canadians believe they must increase their retirement savings to cope with potential health problems during retirement, with 72% saying provincial healthcare services would not cover their full treatment.

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TSX sends delegation to China

(November 10, 2004) The TSX Group is sending a delegation to China in an effort to strengthen ties with the mainland’s two equity markets, in Shenzhen and Shanghai.

“We’re working aggressively to increase our listings from China, a market in which we see tremendous potential,” said Robert Fabes, senior vice-president, Toronto Stock Exchange. “What we offer Chinese companies is a world-class exchange in traditionally strong sectors, like mining and other resources, and also in new sectors like tech and biotech.”

The development team will be lead by TSX Group Co-CEO John Cieslak. The exchange has already signed a memorandum of understanding with the Shenzhen market. A similar deal will be signed in Shanghai on November 19.

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Tricycle launches Wheat Board note

(November 10, 2004) Tricycle Asset Management has announced the launch of its 11th issue, the Canadian Wheat Board Managed Futures Notes, Series N-11, the only managed futures program in Canada backed by an AAA-rated issuer.

“Series N-11 Notes provide true diversification from traditional assets, allowing investors to diversify their portfolios with a low minimum investment, protect the capital they’ve already accumulated and benefit from proven profit potential,” said Fred Hirshfeld, managing director of Tricycle Asset Management. “The exposure we provide to the burgeoning global alternative asset market is what we refer to as Common Sense Investing.”

Series N-11 is also tax deferred, and available as a no-charge, stand-alone RRSP or RRIF through Tricycle and Canada Trust, and has a new front-end load option.

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Fed raises interest rates to 2%

(November 10, 2004) The U.S. Federal Reserve today raised its benchmark lending rate 25 basis points to 2%, the fourth increase this year.

In a statement, the Fed said that with inflation expected to remain under control, interest rates would likely increase at a “measured” pace. Experts believe that means another quarter-point rate hike in December.

The Bank of Canada’s key lending rate currently stands at 2.5%, following a 25-basis point bump in October. The central bank’s next interest rate decision is also set for next month.

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Sprott to re-open equity fund

(November 9, 2004) Sprott Asset Management has announced the re-opening of the Sprott Canadian Equity Fund, effective January 4, 2005.

The initial decision to cap the fund on June 30, 2004 was made “in an effort to maintain and maximize performance of the fund in order to achieve its objectives,” after the fund had reached about $500 million in assets.

“The decision to re-open the fund stems from continued extensive research and uncovering of new and exciting investment opportunities for the fund, Sprott said today in a release. “Sprott Asset Management reserves the right to re-cap the fund in the future should the growth rate of net subscriptions exceed the pace of valued investment opportunities during what we believe to be a difficult and long-term secular bear market.”

The fund will be subject to minimum initial purchases of $5,000 and subsequent minimum purchases of $500. Series I units will be available to qualified and approved institutional investors while series F units will be available to investors who participate in fee-based programs through their dealer.

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CIBC World Markets appoints new president

(November 9, 2004) CIBC World Markets has appointed David Leith as head of its Canadian investment and corporate banking operations. Leith replaces Donald Lindsay, who is taking the president’s job at mining firm Teck Cominco, effective January 1, 2005.

Leith has been with CIBC World Markets since 1983, most recently as a managing director.

“David brings extensive debt, equity and M&A experience gained in over 20 years in investment banking in both London and Toronto,” said Gerry McCaughey, chair and CEO of CIBC World Markets. “David’s leadership and knowledge of the Canadian investment and corporate banking industry will play a key role in helping to maintain our leadership position in the years to come.”

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Cooper, Stymiest among top 100 award winners

(November 9, 2004) About 40 corporate executives have been named by the Women’s Executive Network as part of its annual “Canada’s Most Powerful Women: Top 100” awards program.

The list includes Sherry Cooper of BMO Nesbitt Burns, Karen Maidment and Dina Palozzi of BMO Financial Group, Andrea Rosen of TD Canada Trust and Barbara Stymiest, former head of the TSX, now chief operating officer at RBC Financial.

The winners, who also include entrepreneurs, public servants and other professionals, will be honored at a gala event Wednesday night in Toronto.

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National Life adds mutual fund option to universal life products

(November 9, 2004) National Life today introduced a new investment option for its universal life insurance lineup, offering access to a series of well-known mutual funds.

The new option — called managed accounts — gives policyholders access to some of the best brand-name mutual funds actively managed by leading Canadian and international investment managers, the company said today.

The fund managers include AGF, Bissett, CI, Dynamic, Fidelity, Franklin Templeton, Legg Mason and Talvest.

“Managed accounts offer clients all the benefits of investing with fund managers but with additional tax-deferred advantages because they’re available through a National Life universal life policy,” says National Life’s Martin Devine.

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Fidelity offers tax efficient options

November 8, 2004) Fidelity Investments Canada Limited has announced the release of tax-efficient versions of two of its funds.

As of November 8, investors can buy the Fidelity NorthStar Fund with the Fidelity Tax-Efficient Systematic Withdrawal Plan feature. The Fidelity Canadian Opportunities Fund is now available in Fidelity Capital Structure, which offers fund switching without a deemed disposition when held outside of a registered account.

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Doctors’ fund cuts MERs

(November 8, 2004) CMA Holdings Inc. (CMAH) has announced a 10 basis-point reduction of the MER on MD Bond Fund, MD Bond and Mortgage Fund. It has also reduced the fees charged to MD Private Investment Management clients.

“Through prudent management of our overall fund portfolio, we can decrease MERs due to capital market improvements and other management efficiencies,” said Hewett. “This is just another example of our intention to maximize value to our clients and not only our bottom line — in this case by passing along savings as they’re achieved and making the funds more affordable.”

CMA Holdings operates MD Funds Management Inc. and offers financial services to Canada’s doctors. CMAH also acquired Howson Tattersall and Saxon Mutual Funds last year.

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West, Ontario to outperform in 2005

(November 8, 2004) Western provinces, especially Alberta, should continue to post strong economic gains in 2005, with Ontario joining the rise, according to the Conference Board of Canada’s Provincial Outlook – Autumn 2004.

“Western Canadian economies are sizzling this year as a result of high lumber, base metals and oil prices — the top three provincial economies are in the West,” said Marie-Christine Bernard, associate director, Provincial Outlook. “Ontario’s economy will heat up in 2005, however, fuelled by strong business investment and consumer demand.”

Alberta, British Columbia, Manitoba and Ontario should all see GDP growth top 3%, while Quebec, Saskatchewan, Nova Scotia and New Brunswick will post growth rates between 2.6% and 2.9%. The Conference Board says growth prospects for Newfoundland and Prince Edward Island are likely to remain relatively flat.

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