Briefly:

(October 30, 2003) The MFDA says its compliance review process has uncovered cases of fund dealers working with clients in jurisdictions where the dealer is not registered.

The MFDA says fund dealers must obtain registration in all provinces and territories where clients are located, regardless of where the client was when the account was opened or whether there is trading in the account.

MFDA members and approved persons found to be in violation of the bylaw have six months to either obtain the required registration or transfer the account.

If the deadline is not met, the MFDA says it may begin disciplinary proceedings and notes that action taken by the association does not preclude further disciplinary action by provincial and territorial regulators.

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Investors Group posts higher quarterly earnings

(October 30, 2003) A rebound in the financial markets helped the country’s second-largest mutual fund company post higher profits in the third quarter. Winnipeg-based Investors Group today reported net income of $140 million in Q3, up from $125 million during the same period last year.

Year to date, Investors Group’s profits reached $390 million, compared to $372 million in the first nine months of 2002.

“The strength of financial markets over the past year has provided clients with attractive returns and contributed to stronger financial performance by the company,” said Investors Group president Jeffrey Orr.

Gross revenues for the third quarter were $474.4 million, unchanged from last year. Assets under management rose $3 billion to $76.3 billion.

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Pension funds recovering, RBC says

(October 30, 2003) Canada’s pension funds have seen their fortunes improve, thanks to back-to-back positive quarters on the equity markets, according to an RBC Global Services survey released today.

But the investment analytics and trade management services provider says they could have done better, if the funds had not been shy of the tech sector which punished them in the past.

“Most active managers shied away from the run-up in technology stock prices that produced a spectacular 48% return in the sector,” says Fred Francis, vice-president of value-added products for RBC Global Services. “With just 2.4% of domestic equity portfolios in high-flying tech stocks, less than half the weighting in the TSX, the median manager underperformed the market index by 1% since the beginning of the year.”

Still, pension funds are approaching the returns they require to meet their funding obligations, with the median five-year return hitting 6.5%.

“This upswing is heartening news for Canadian companies struggling with pension fund shortfalls, which haven’t quite turned the corner yet,” says Francis.

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Peak Securities opens up shop in B.C.

(October 30, 2003) Montreal-based Peak Securities has registered with the IDA’s Pacific District office to open its first brokerage in British Columbia. Peak already operates in Ontario and Quebec and plans to register in other provinces as well.

“We understand what independent brokers are seeking as we are ourselves fully independent and are committed and able to remain this way,” says Robert Frances, president and CEO of Peak Financial Group.

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CCRA raises pension earnings ceiling

(October 29, 2003) CCRA is raising the annual salary limit on pensionable earnings under the CPP to $40,500 in 2004, up from $39,900 in 2003. The increase reflects the growth in average weekly wages and salaries in Canada, CCRA said in a news release.

Earnings above $40,500 will not be subject to CPP contributions. The basic CPP exemption amount for 2004 remains $3,500. Individuals who earn less than that amount do not contribute to the CPP.

The employee and employer contribution rates for 2004 will remain unchanged at 4.95% and the self-employed contribution rate will stay at 9.9%. The maximum employer and employee contribution to the plan will be $1,831.50 and the maximum self-employed contribution will be $3,663.

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U.S. social investment market “robust,” survey reveals

(October 29, 2003) The U.S. social investment industry enjoyed healthy gains during 2001 and 2002, according to a survey released today by the Social Investment Forum. Assets in U.S. socially screened portfolios climbed 7% this year to $2.15 trillion. That compares to a 4% decline for all professionally managed investment portfolios, the survey says.

Assets in the approximately 200 U.S. socially responsible mutual funds rose 19% over two years, to $162 billion in 2003 from $136 billion in 2001.

“During 2001 and 2002, as the economy receded and the overall stock and bond markets lost ground, the assets in socially and environmentally responsible portfolios proved remarkably robust,” says Social Investment Forum president Tim Smith.

In Canada, the Social Investment Organization released its biannual survey of the SRI industry earlier this year. Total Canadian assets managed according to social responsibility guidelines stood at $51.4 billion as of June 30, 2002, up from $49.9 billion in 2000, the Canadian Social Investment Review revealed. That’s about 3% of the Canadian market, unchanged from three years ago.

Assets in the 50 or so Canadian SRI mutual funds fell from $10.3 billion in 2000 to $9.9 billion in 2002.

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Laurier honours OSC chair

(October 29, 2003) Wilfrid Laurier University in Waterloo, Ontario, has named Ontario Securities Commission (OSC) chair David Brown the Laurier Outstanding Business Leader of the Year. Brown is being recognized for his “outstanding work in promoting stronger regulatory frameworks for good corporate governance in Canada.”

“Mr. Brown’s personal commitment and accomplishments certainly reflect the characteristics that Laurier wants to instill in its students,” said Scott Carson, dean of the school of business and economics.

Under Brown’s leadership the OSC has strengthened its enforcement branch and its investor education program. The OSC has also improved service to market participants and stepped to the forefront in responding to emerging issues in the regulatory environment.

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GGOF launches new Asia fund

(October 28, 2003) GGOF Guardian Group of Funds has unveiled a new fund aimed at investors seeking more exposure to the growing Asian economies — GGOF Asian Growth and Income Fund. The fund will be sub-advised by San Francisco-based Matthews International Capital Management, which specializes in Asian markets.

“The range and depth of experience behind the fund’s investment management team makes it an ideal fund for investors who may have previously avoided the region,” said John Boeckh, senior vice-president of marketing with GGOF Guardian Group of Funds.

The fund has a flexible mandate that allows it to invest across Asia, but will focus on the high-growth economies of Korea, Singapore, Taiwan, China, India and Indonesia, as well as Japan.

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Mackenzie launches two new fund brands

(October 28, 2003) Mackenzie Financial has launched two new brands which will be made up of existing funds. Mackenzie Sentinel will be comprised of fourteen existing fixed income funds and Mackenzie Select Managers will include six of Mackenzie’s former Universal Select Managers series of funds.

“With these changes, we’ve taken one more step to make our array of products easier to understand,” said David Feather, president of Mackenzie Financial Services Inc.

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Advisor Forum 2003 heads west to Calgary

(October 27, 2003) Attention western advisors! Tomorrow is the kick-off of the Calgary edition of Advisor Forum 2003 as the five-city tour rolls into town.

The two-day conference starts on Tuesday, October 28 with a keynote address from marketing guru Bill Good, who will share his insights on “How to be up in any market.”

There are a series of main-stage presentations throughout the day, including “Closed-end fund investing: Value-added through cost-effective indexing strategy supplemented by active management,” and “Income alternatives for uncertain times.”

There will also be the presentation of the prestigious Advisor of the Year Award to Regina-based advisor Pat Horning.

Wednesday’s schedule includes the keynote address from John De Goey, a senior advisor with Assante Capital Management Ltd. “So you call yourself a professional?” and continues with main-stage topics including “After-tax returns and after-death concerns.”

Check Advisor.ca later this week for Advisor Forum coverage from Calgary. The conference heads to Vancouver on November 3-4, followed by Toronto on November 18-19 and wraps up in Halifax on December 1-2.

For more information on the Advisor Forum schedule and to register online for the conference, go to www.advisorforum.ca or click here.

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CI survey shows Canadians ill-prepared

(October 27, 2003) A new survey by Desjardins Financial shows that Canadians are poorly prepared to cope financially if they are unable to work due to illness of injury. The 2003 Desjardins Financial Security National Health survey says 39% would run into financial trouble.

“At the very minimum 12 million Canadians’ financial futures face life support because a proportion of the population continues to hold onto the traditional notion of universality in healthcare ‘that all will be taken care of,'” said Taylor Train, vice-president of marketing for Desjardins Financial Security.

The survey said that 72% of respondents were aware that their provincial government would not cover all the medical costs associated with an illness or injury, including recovery.

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(10/27/03)