Briefly:

(October 24, 2003) Federal Finance Minister John Manley has announced the appointment of Charlottetown lawyer Ronald J. Keefe to the board of directors of the Bank of Canada.

“I am confident that Mr. Keefe will serve the Bank of Canada effectively,” Manley stated. “He brings impeccable credentials and a wealth of experience to his new position.”

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CSA approves research analyst standards

(October 23, 2003) The Canadian Securities Administrators has rubber-stamped the IDA’s long-awaited policy on research analyst standards. Policy 11, in the works for more than two years, will become effective immediately, the IDA says.

The standards deal mainly with conflicts of interest faced by analysts. For example, all IDA member firms must have written conflict-of-interest policies and procedures in place, and must disclose all relationships that have built-in conflicts.

The policy also includes a number of prohibitions, such as compensating research analysts directly from investment banking revenues and barring analysts from serving on the boards of companies that they cover.

“The public has a right and a need to know what shares a firm or analyst owns and any compensation practices that may influence an analyst’s recommendations,” says IDA president Joe Oliver.

The guidelines include a recommendation that analysts obtain the Chartered Financial Analyst designation, although the IDA adds it’s up to member firms to decide if other accreditations may also be appropriate.

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TD: Stocks will outperform in 2004

(October 23, 2003) Equity investors will benefit from stronger economic growth and low inflation in 2004, according to a report out today from TD Economics. The bank says that while the economy will heat up, interest rates should be “only modestly higher.”

“Equities are likely to outperform cash, which, in turn, will fare better than bonds in 2004,” said Craig Alexander, associate vice president and senior economist at TD Bank Financial Group.

In a related report, TD Waterhouse says that investors they surveyed want to return to the market, but still have cold feet after the three-year bear market.

“Financial advisors have long promoted the virtue of a ‘buy/hold/diversify’ approach to managing an investment portfolio,” says Patricia Lovett-Reid, senior vice-president at TD Waterhouse Canada. “The message for investors is, ‘Get invested, stay invested.'”

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Dodge sees steady growth in 2004

(October 22, 2003) The Bank of Canada released its Monetary Policy Report this morning, saying that there is more slack in the economy than it had predicted in April. Inflation was lower than expected due to a variety of factors, including the B.C. forest fires, the stronger dollar, severe acute respiratory syndrome, the Ontario blackout and the mad-cow scare in Alberta.

The bank said that its short-term outlook for the U.S. economy and the global economy was now improved overall, with some weakness expected in Europe. On the domestic front the bank also predicts strong household spending and business investment, with core inflation for 2004 at around 1%.

A group of export-based industry associations responded to the report, saying that the dollar is appreciating too quickly for the economy to bear.

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Manulife Bank offers high-interest business account

(October 22, 2003) Manulife Bank has unveiled its Business Advantage Account, which it says will offer higher interest to businesses on their short-term cash holdings.

“Our research shows that Canadian business owners don’t have many attractive options for making their short-term cash grow while keeping it easily accessible,” says J. Roman Fedchyshyn, president and CEO of Manulife Bank. “Business Advantage Account allows all of their short-term cash to earn a great rate of interest and allows them to access their money in a number of ways whenever it’s needed.”

Funds are transferred between the account and the business’s operating account over the telephone, much like the popular high-interest personal savings accounts that have recently grown in popularity.

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Performa Financial names new execs

(October 21, 2003) Standard Life has announced the appointment of Andy Mitchell as president of Performa Financial Group Limited, the insurance firm’s mutual fund dealer. Mitchell had been regional vice-president and senior consultant to Standard Life Mutual Funds.

Mitchell has appointed Richard McIntyre as vice-president of advisor services, and Jerry Hogarth as vice-president of operations. McIntyre had been vice-president of sales operations, also with Standard Life Mutual Funds. Jerry Hogarth has spent most of his 16-year career in compliance and operations management.

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Manulife wins lawyers’ group RRSP contract

(October 21, 2003) Manulife Financial Canadian Pension Operations has landed a deal for the exclusive marketing contract for the Canadian Bar Association Financial Services’ group RRSP, effective January 1, 2004.

The deal could prove extremely lucrative, as CBA Financial provides financial services to the 37,000 members of the Canadian Bar Association.

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Foreign investors sell bonds, take stock

(October 20, 2003) Foreign investors opted out of the Canadian debt market in August, preferring our equities instead. Debt security sales hit $8.5 billion, with $1.3 billion coming into the stock market for a total net sale of $7.2 billion.

Foreign investors have sold off $13.1 billion in Canadian bonds in the past two months, as the gap between Canadian and U.S. short-term interest rates narrowed to 176 basis points in August.

Canadian investors expanded their holdings in foreign securities, buying a total of $1.9 billion, with $1.3 billion going into equities. While investors have bought $3.6 billion in foreign investment in the past four month, they sold $3.2 billion in the first four months of the year.

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Dynamic approved for limited short-selling

(October 20, 2003) Dynamic Mutual Funds has received approval for short-selling in its Dynamic Power family of funds. The strategy will be employed starting in the new year.

“We asked our investors as well as mutual fund regulators for approval to add this valuable investment tool to our management, and both approved,” says David Goodman, president and CEO of Dynamic. “We are confident that this enhancement will lead to more effective management and better long-term performance.”

The funds affected include the Dynamic Power Canadian Growth Fund, Canadian Growth Class, American Growth Fund, American Growth Class, Balanced Fund and the Global Growth Class (formerly named International Growth Class).

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(10/20/03)