Briefly:

(July 11, 2003) A lunch with investment guru Warren Buffett has fetched more than a quarter of a million dollars in an online auction. An anonymous bidder won the prize yesterday with an E-bay bid of $250,100 US. Buffett is donating the proceeds of the auction to Glide, a San Francisco-based charity that helps the homeless.

The auction, billed as “a once-in-a-lifetime chance to pick the brain of the one and only Warren Buffett,” attracted 141 bidders with an opening price of $10,000 US.

The lunch for eight with Buffett will be held in New York City in May 2004.

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Canada Life offloads Caribbean assets

(July 11, 2003) Following a strategic review, Canada Life has sold off two insurance businesses in the Caribbean. The life insurance company, recently acquired by Great West Life, announced today it had sold its Bahamian and Cayman Islands life and health insurance business to Colina Insurance, the largest insurer in the Bahamas.

Canada Life also announced today that it is selling its group life and health insurance business in Puerto Rico and the U.S. Virgin Islands to MAPFRE USA, a Puerto Rican holding company.

Canada Life acquired the Caribbean firms when it purchased Crown Life in 1999. Financial details of the two sales were not released.

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Insurance industry rebounds in June

(July 10, 2003) The North American life insurance industry has snapped an eight-month losing streak, as applications for new policies rose 2.7% in June.

This improvement was not enough to offset the lower levels in previous months, which finished the second quarter 6.1% below levels for the same period in 2002. The U.S. saw gains of 2.8%, while the Canadian industry posted a slightly lower 2.2% increase.

The top-performing demographic remained the 60+ age group.

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FPSC reveals CFP exam results

(July 10, 2003) More than 700 financial planners have passed the summer sitting of the CFP exam. The Financial Planners Standards Council says that of the 1,235 individuals writing the June 7 exam, 57% passed.

The pass rate for the summer CFP exam has hovered between 55% and 61% over the past four years. The number of people writing this year was down about 17% from last summer, when nearly 1,489 took the test. A record 1,497 individuals sat the test in June 2000.

The six-hour CFP exam was held in 52 centres across Canada. The list of successful candidates will be published in the Globe and Mail in September. The next CFP exam is scheduled for November 22. More than 15,000 Canadian planners now hold the CFP mark.

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RBC boosts presence in Florida

(July 10, 2003) Royal Bank’s U.S. subsidiary, RBC Centura, is doubling its presence in Florida, with the purchase of Provident’s operations in that state.

Provident’s presence in Florida includes 13 branches, 16 ATMs and 135 employees and serves western Florida. The network holds total deposit balances of around $750 million (US) with $500 million (US) in assets under management and $350 million (US) in loans.

The deal is expected to close this fall, pending regulatory approval.

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Great-West Lifeco seals Canada Life acquisition

(July 10, 2003) Great-West Lifeco has completed its acquisition of Canada Life. The deal cost Great-West $4.2 billion in cash, 56 million common shares and 32 million preferred shares.

Shareholders of Canada Life can expect their cheques and/or Great-West share certificates beginning July 15.

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U.K. top spot for Canadian investment in Europe

(July 9, 2003) The U.K. remains the favourite place to invest for Canadian businesses seeking a European presence, says a report from Invest UK.

The government agency said there were 71 new projects starting this financial year, up from 55 last year. Canadian investment in Britain was $45 billion in 2002, according to StatsCan.

“We have the lowest inflation for 30 years, the lowest interest rates in 40 years and the highest employment ever and our economy — unique in the G-7 — has avoided recession,” said Trade and Industry Secretary Patricia Hewitt.

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Maritime Life buys Liberty Health assets

(July 9, 2003) Maritime Life has assumed Liberty Health’s insurance business in a $140 million deal that will fetch $700 million in premiums and equivalents to Maritime.

Maritime has bought the entire Liberty Health portfolio including group life, group disability, group health and individual health insurance businesses.

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Scotia adds international research partners

(July 8, 2003) Scotia Capital has teamed up with Macquarie Equities of Australia and South Africa’s Nedcor Securities, forming an international research alliance.

“This alliance will allow us to provide our clients with a broader industry perspective, particularly in the resource sectors,” said Lawrence Lewis, managing director, acting head of equity research for Scotia Capital.

Macquarie Bank, parent of the Australian brokerage, operates in 18 countries. Nedcor is the brokerage arm of South Africa’s largest bank, Nedbank.

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Exporters nervous about immediate future

(July 8, 2003) Canadian exporters continue to lose confidence as the soaring loonie and sluggish U.S. economy erode sales, according to a survey by Export Development Canada (EDC).

The high dollar was of concern to 91% of respondents and 39% said they thought the dollar would continue to rise over the next six months. Only 30% said it would decline.

“There is no question that a stronger dollar will squeeze exporters’ profit margins in the short term,” said Stephen Poloz , EDC vice-president and chief economist. “But export sales are up from their 2001 lows, resource prices are higher, and the costs of imported components and machinery are declining, all of which need to be taken into account longer term.”

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IPOs drop in number and value

(July 7, 2003) The number of initial public offerings (IPOs) brought to market in the first half of 2003 continued to sag, with only 22 new listings, according to PricewaterhouseCoopers LLP. New offerings by this time last year reached 30.

Total value of IPOs was $1.5 billion, down from $2.3 billion in 2002. Income trusts remained in favour, with 45% of new offerings, but 80% of the value of the total.

“The continuing domination of the IPO market by income trusts illustrates that such a trend can quickly become a defining quality of markets,” said Eric Slavens, IPO Services leader for PricewaterhouseCoopers. “It is worth reminding ourselves, however, that an investor’s return from an income trust depends entirely on the performance of the underlying asset.”

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BMO pushes further into U.S. market with GKM purchase

(July 7, 2003) BMO Financial Group continued its expansion into the U.S. market with the purchase of Gerard Klauer Mattison, a New York-based investment bank.

The firm will be rebranded as Harris Nesbitt Gerard. As of today, BMO will also consolidate six lines of business in the U.S. under the name Harris Nesbitt.

Harris Nesbitt Gerard will continue to provide sales, trading and investment banking services as well as offering U.S. equity research to Canadian institutional clients.

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Canada Life opens new portal for reps

(July 7, 2003) Canada Life has rolled out a new Internet portal allowing its distribution partners to access information on pending and in-force business called Rep Access: Pending & In-force Details (RAPID).

“Our business partners requested a responsive self-service tool to help manage their rapidly changing business needs,” said Hampton. “As the acronym implies, RAPID is an efficient resource connecting Canada Life’s business partners to the information they need, at the moment they need it.”

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Worldwide mutual fund assets slide

(July 7, 2003) The value of worldwide assets in mutual funds dipped slightly from US$11.22 trillion to US$11.21 trillion in the first quarter, according to The Investment Company Institute.

Equity fund assets were hit hardest, dropping 4.2% as stock markets continued to struggle around the world. Bond fund assets rose 5.7% on market strength in Europe and the Americas.

Net sales of all funds were US$13 billion, down from US$153 billion in the fourth quarter of 2002. Broken down by asset class, 36% of the total was invested in equity funds, 29% in money market funds and 24% in bond funds. Balanced funds accounted for 8%.

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(07/07/03)