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(September 5, 2007) On Wednesday morning the Bank of Canada announced that it would keep the overnight rate target at 4.5%. The overnight rate’s operating band is also unchanged at 4.75%.

This news likely surprised some people as there was a real possibility of a rate cut, due to America’s sub-prime woes.

But the BoC says a number of factors helped it decide not to cut rates, one being that the near-term prospects for economic growth outside North America looks to be stronger than anticipated, despite the near-term economic outlook for the U.S. being weaker than expected.

As well, total and core CPI inflation in July were at 2.2% and 2.3% respectively. Those numbers are above the inflation target.

The Bank says the Canadian economy is operating above its estimated July production potential due to strong domestic demand, a healthy labour market and better-than-expected home sales and prices.

But the Bank admits that America’s housing issues could spill over into the economy as a whole, and that credit uncertainty could slow down Canada’s domestic growth.

The BoC says it will keep a close watch on evolving economic developments and could cut the rate if need be on October 16, the bank’s next overnight target rate announcement.

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Claude Lamoureux retires from Ontario Teachers’ Pension Plan

(September 5, 2007)Here’s a trivia question for pension plan buffs: Who was the first president and CEO of the Ontario Teachers’ Pension Plan? If you answered Claude Lamoureux, you’d be right.

Not only was Lamoureux the first president of the OTPP, until now he was the only one. On Wednesday, though, Eileen Mercier, chair of the OTPP announced that Lamoureux’s 17-year reign was coming to an end, as he’s decided to retire effective December 1.

“Claude is a visionary and a pioneer,” says Mercier. “He leaves in place a legacy of member service and investment wisdom that is emulated by other pension plans and funds worldwide. The teachers of Ontario today enjoy a pension income that simply would not have been possible without his skill and leadership.”

Mercier continues with the accolades, saying Lamoureux was a “lone institutional investor voice” who advocated for improved corporate governance and shareholder rights.

Highlighting the increasing importance of private equity, the board unanimously voted for Jim Leech, a senior vice-president of Teachers’ Private Capital, to take over.

“The board’s human resources and compensation committee undertook a fair, transparent and comprehensive succession process review over the previous months in anticipation of Claude’s retirement,” says Mercier. “We took the same approach we would expect of our portfolio companies — a comprehensive succession process to ensure the best possible successor to Claude, for the best possible impact on the organization and its members. Teachers’ has a tradition of cultivating its talent internally and promoting from within, and we are thrilled to be able to announce Jim as Claude’s successor.”

When Leech joined OTPP in 2001, he was tasked with expanding the Teachers’ private investments activities globally. Since then, Teachers’ Private Capital has grown into one of the world’s largest private investors, with more than $16 billion in assets.

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Assumption Life introduces 12 new funds

(September 5, 2007) Assumption Life isn’t satisfied with just launching one or two new products at a time — they’ve rolled out a dozen new offerings on Wednesday.

The company announced that these products will help investors diversify their portfolios while benefiting from recent world growth trends.

Assumption Life has also added AGF as a new fund manager, joining CI, Fidelity and Montrusco Bolton, who already manage AL funds.

“We have been listening closely to the needs of investors and our sales force, who want a variety of investment funds from which to choose,” says Denis Losier, Assumption Life’s president and CEO. “We examined and analyzed all available options in detail before making our final decision concerning both the new funds and our new fund manager. We select our managers based on their reputation among investors, on the quality of their funds and on their demonstrating a history of achieving results that exceed the market average.”

The new funds include the Assumption/Fidelity American Disciplined Equity Fund, the Assumption/CI Synergy Global Corporate Class and the Assumption/AGF Global Financial Services Class.

“With this expansion of our existing family of 21 funds, investors will be positioned to assemble a complete portfolio, and our agents and brokers will have even more options for making appropriate recommendations and customizing solutions to meet the needs of clients,” adds Losier.

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Davor Milardovic receives permanent ban from IDA

(September 5, 2007) When the Investment Dealers Association of Canada pencils you in for a meeting, it’s a good idea to show up. That’s what Toronto’s Davor “Dave” Milardovic found out after he failed to attend a series of interviews set up by the IDA.

The association was investigating the circumstances around Milardovic’s firing from the IPC Securities Corporation. It had planned to ask him about the dismissal, but when he skipped out on the meeting, a disciplinary hearing was set up, and Milardovic was found guilty of failing to cooperate in an IDA investigation.

Milardovic was assessed a $50,000 fine, ordered to pay $8,000 in costs and received a permanent ban from the IDA.

(09/05/07)