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Swiss banking giant UBS has found itself in the middle of an international tug-of-war.

Switzerland’s Federal Department of Justice and Police has stated in no uncertain terms that it would be illegal for UBS to hand client information over to the U.S. government, which is seeking details on 52,000 accounts held at the bank.

America’s Internal Revenue Service says that Swiss bank secrecy laws should not be interpreted so as to allow UBS to aid American citizens in tax evasion. The case is currently before a Miami court.

“Switzerland makes it perfectly clear that Swiss law prohibits UBS from complying with a possible order by the court in Miami to hand over the client information,” the Swiss said in a press release. “In addition, on the basis of the Federal Council’s decision of principle, UBS will by no means be in a position to comply with such an order. According to that decision, all the necessary measures should be taken to prevent UBS from handing over the information on the 52,000 account holders demanded in the U.S. civil proceeding.

“The order prohibits UBS explicitly from handing over client information.”

Read: OECD targets “aggressive tax planning”

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Claymore creates new dividend ETF

Claymore Investments has signed a deal with Standard & Poor’s to license the S&P/TSX Canadian Dividend Aristocrats Index as the basis of a newly created ETF..

The S&P/TSX Canadian Dividend Aristocrats Index measures the performance of Canadian companies that have followed a managed-dividends policy of consistently increasing dividends for at least five years.

The S&P/TSX Canadian Dividend Aristocrats Index is weighted by indicated annual dividend yield. To prevent the index from being concentrated in only a few names, the methodology provides that no individual stock represents more than 8% of the index and no income trust represents more than 5% of the index.

The S&P/TSX Canadian Dividend Aristocrats Index captures both sustainable dividend income and capital appreciation potential.

Claymore also announced a revised exchange ratio for its merger of Adjustable Rate MBS Trust with Claymore Global Monthly Advantaged Dividend ETF.

Unitholders of the Adjustable Rate MBS Trust will receive 1.6015 the Advisor Class Units of Claymore Global Monthly Advantaged Dividend ETF for each unit of the trust held by them as determined by reference to the adjusted relative net asset values of the units both funds on July 2, 2009.

Trust unitholders who chose not to participate in the merger are entitled to receive an adjusted cash payment of $19.518 per unit redeemed as determined by reference to the adjusted net asset value of the units as of June 30, 2009.

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Market Logics appoints new exec

Bill Henderson has joined Market Logics as executive vice-president and operations specialist.

“Bill’s expertise in building leading edge operations platforms further augments our capabilities in providing corporate solutions in today’s economic environment — where everyone is scouring their organizations looking for opportunities to minimize fixed costs without sacrificing corporate progress,” says George Hartman, president and CEO of Market Logics.

Henderson has 38 years of operations and technology leadership at Merrill Lynch, Wood Gundy, TD Bank and Fidelity Investments.

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Nonprofits review traditional consultant approach

After large investment losses, a number of nonprofit organizations and endowments are evaluating their overall investment management process and considering other options to protect against market volatility, according to a survey by SEI.

Last year’s market downturn significantly impacted nonprofits as 81% said their organization’s overall invested assets decreased by at least 21%.

Thirty one percent of nonprofits using a consultant model for investment management indicated that they were dissatisfied with this approach and are looking for other options. Almost half (45%) of that group believe there should have been more proactive communication from the consultant during the recent market turmoil.

Meanwhile, 30% of those polled indicated that defining investment management fiduciary responsibilities for trustees and investment consultants is a top priority.

“For many nonprofits, the wheels came off the entire process and they are seriously considering if their current approach to investment management is the best approach moving forward,” said Carolyn McLaurin, vice-president and managing director of SEI’s nonprofit group. “As nonprofits determine strategies for addressing a wide range of issues, the external help they receive needs to be aligned with their efforts. Many are realizing this wasn’t always the case.”

According to the poll, 71% said that their organization is adjusting asset allocation in response to current environment. Many are decreasing their allocation to U.S. equities, (56%), non-US equities (63%) and hedge funds (58%).

Conversely, 69% said they were increasing their allocation to fixed income. In addition, 63% of respondents said maintaining an appropriate level of liquidity in the investment portfolio is a top priority.

(07/08/09)