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(April 8, 2008) The Pan-Canadian Committee for Third-Party Structured Asset-Backed Commercial Paper revealed Tuesday that satellite trusts of Structured Asset Trust Series E and Structured Investment Trust III Series E have reached an agreement with CIBC related to the termination of three CIBC credit default swaps.

The agreement on the swaps was a condition of CIBC’s role in the margin funding facility, an integral part of the committee’s restructuring plan.

This ends months of negations between CIBC and those investors who own a large part of the outstanding SAT Series E notes.

With the agreement, a credit default swap transaction with Nemertes Credit Linked Certificate Trust Series 2006, has ended.

The termination resulted in a $163 million loss (or 23% of the principal) to note holders of SAT Series E. So far, investors have recovered about 77% of the funds.

“We are pleased to see the successful restructuring of these swaps,” says Purdy Crawford, chair of the committee. “This restructuring is a long and complicated road comprising many steps, and today’s announcement represents further progress towards successful implementation of the overall restructuring plan.”

CIBC is just one financial institution working with the committee to fix liquidity issues stemming from the ABCP crisis.

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CFOs wielding more power and influence: Ernst & Young

Aspiring CEOs may want to set their sights on a different job. According to a new Ernst & Young report, chief financial officers have more influence and responsibility than ever before.

The report, conducted by E&Y and CFO Research Services, says senior management and directors increasingly expect CFOs to deal with strategic issues rather than concentrating only on financial information.

“In order to rise to the standard now expected of them, CFOs must first improve their financial operations, which have become disjointed and inefficient in the wake of rapid growth in the industry. Only then can CFOs become true strategic partners, helping to evaluate new products, provide leading indicators on business performance and drive merger and acquisition opportunities,” says the company.

Andrew de Haan, an E&Y spokesperson, says banks that have CFOs around the “strategic planning table” will win out. “CFOs have the knowledge to guide their organizations and help navigate these tumultuous times.”

The survey points out that the credit crunch has forced firms to pay closer attention to finance and balance sheets. Bringing in someone who has proven business experience can be just the thing to turn a failing company around.

E&Y says that banks specifically are centralizing the CFO’s responsibility in order to bring that individual’s “holistic perspective” to the rest of the company.

“CFOs are elevating their game to meet the demands of today’s market conditions,” says T. J. Letarte, head of Ernst & Young’s Americas’ Finance and Performance Management practice for financial services. “In addition to the important work they’ve always done monitoring and reporting, they’re also helping to provide their firms with a comprehensive, actionable view of risk. By doing so, they’re creating more competitive institutions that can face future challenges more resiliently.”

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RBC launches new program for managers

(April 8, 2008) Thanks to a new initiative by RBC Capital Markets, hedge fund, mutual fund and institutional asset managers will find it easier to do business.

The bank’s Global Prime Services Group will provide “dedicated and comprehensive support” to these managers through a single platform backed by RBC.

“We recognize that the lines between hedge fund and traditional institutional managers are becoming more obscure as their needs become more similar,” says Jeremy Frommer, head of RBC Global Prime Services. “Hedge funds are going public and no longer using only long/short strategies, traditional fund managers are launching 130/30 funds, using leverage and shorting, while institutional managers need more robust services.”

The new group will offer managers everything from prime brokerage and trading technology to securities lending, capital introductions and financing.

The unit will feature a “single-point-of-contact” customer service platform. “Our unique single point of contact for multi-asset-class service provides a consolidated view of a client’s portfolio, enabling us to fully understand our clients’ needs and provide the right products and the highest level of service possible,” says Daniel Dorenbush, head of relationship management for RBC Global Prime Services.

(04/08/08)