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(August 31, 2007) Scotiabank has signed an agreement to purchase 79% of Banco del Desarrollo, Chile’s seventh largest bank for $810 million US. The bank says it’s the first stage in a plan to purchase up to 100% of Banco del Desarrollo.

Scotiabank says Banco del Desarrollo, which has total assets of more than $5.1 billion US, has a nationwide network of 74 branches and specialized skills in mid-market commercial lending, small business and micro business lending, and consumer finance.

The 79% stake will be purchased from Sociedad de Inversiones Norte Sur S.A., a Chilean investment firm that holds 39% of Banco del Desarrollo; Credit Agricole S.A. of France, which holds 24%; and Italian bank Intesa Sanpaolo S.P.A., which has a 16% stake.

Scotiabank also says it expects to acquire up to 100% of Banco del Desarrollo, which would be valued at $1.03 billion US. Combined with Scotiabank’s existing Chilean presence, the combined operations would create Chile’s sixth largest bank. Scotiabank intends to keep the two brands separate, though, each to focus on their “unique market segments.”

“This is a unique opportunity to increase our market penetration in one of the most developed and attractive markets in Latin America,” said Rick Waugh, Scotiabank president and CEO. “It is consistent with our overall strategy of driving sustainable revenue growth by building our presence in countries where we have existing operations.”

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Economy strong in Q2: StatsCan

(August 31, 2007) The Canadian economy chugged along at a healthy pace for the second quarter of this year, Statistics Canada reports.

StatsCan says real gross domestic product (GDP) was up 0.8% in the second quarter of 2007. The strength was widespread as consumer and investment expenditures accelerated from the first quarter and businesses continued to add to inventories.

Even more telling about the underlying strength of the Canadian economy is that the rise in the dollar did not cut into demand for Canadian exports. StatsCan says that despite the substantial rise of the Canadian dollar relative to its U.S. counterpart, exports increased, even outpacing first-quarter gains.

The economy grew at an annualized rate of 3.4%, down slightly from the strong pace set in the first quarter, StatsCan says. This growth puts Canada more in line with the U.S. economy, which has an annualized rate of 4.0%.

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Mavrix suspends new issues of Multi-Series Fund

(August 31, 2007) Mavrix Fund Management is temporarily closing the corporate class shares of Mavrix Multi Series Fund Ltd. — Short Term Income Series to new purchase orders in order to avoid “potential adverse tax consequences.”

In addition to the closing of purchase orders, Mavrix will not accept transfers from other Mavrix Funds as of 4:00 p.m., Friday, August 31, 2007. Existing pre-authorized chequing plan purchases will be allowed to continue.

Mavrix says the closure will be lifted when deemed appropriate.

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Counsel Wealth Management’s funds clean of sub-prime

(August 31, 2007) A little behind many of its peers, Counsel Group of Funds nevertheless wants investors to know it’s a sub-prime–free zone.

In a statement, the company, which is a subsidiary of IGM Financial, confirmed that its money market funds have no exposure to non–bank-sponsored asset-backed commercial paper, U.S. sub-prime issues or collateralized debt obligations.

(08/31/07)