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(November 21, 2008) Finance Minister Jim Flaherty has asked all federally regulated financial institutions to help spread the word that seniors are not required to sell assets held within their registered retirement income funds.

“Many seniors are understandably concerned about the impact of the recent deterioration in market conditions on their financial security and I believe it is important to ensure that they do not face undue obstacles in managing their assets in these challenging times,” Flaherty wrote in an open letter.

He went on to point out that the required withdrawals from a RRIF may be made in kind, with the investor simply transferring assets out of the registered account into a non-registered account. No sale of the investment is required. Flaherty expressed concern that some financial institutions were not advising clients of this option.

“To address this issue, I am expecting all financial institutions to accommodate in-kind transfers — at no cost to clients — or offer another solution that achieves the same result,” he wrote. “I would ask that you ensure that all clients with RRIFs be made aware that this option exists.”

He has given federally regulated companies a deadline of November 28 to confirm that they are advising clients of this strategy and facilitating in-kind transfers at no cost.

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B.C. introduces legislation to protect registered funds

(November 21, 2008) The Government of British Columbia has introduced legislation to protect registered funds from creditors.

It will make amendments to the Court Order Enforcement Act and the Pension Benefits Standards Act to keep registered retirement savings plans and similar funds inside other registered plans from being seized by creditors.

The government will also make amendments to the Law and Equity Act in anticipation of the new tax-free savings account to ensure that the designation of a beneficiary will be honoured on the account holder’s death.

These and other proposed amendments are part of the province’s 10-point economic plan — announced last month — to help keep British Columbia’s economy stable during the global financial crisis.

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CPI growth edges lower in October

(November 21, 2008) Canada’s rate of inflation moderated in October, according to StatsCan, with the consumer price index rising 2.6% over a 12-month period, down from 3.4% posted in September.

While the price of gasoline fell in October on sagging oil prices, the price at the pumps was still the greatest contributor to rising CPI over the past 12 months, with an increase of 13.3%. In September, the 12-month price increase had been 26.5%

Excluding energy, CPI rose 1.8% since October 2007.

Helping to offset the price of gas and food were price declines for purchasing and leasing passenger vehicles, women’s clothing and computer equipment and supplies.

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MFS announces job cuts

(November 21, 2008) MFS Investment Management, a division of Sun Life, plans to eliminate of approximately 90 jobs across the organization, representing approximately 5% of its workforce.

The reduction comes in response to the decline over the past 12 months in capital markets that has affected the Boston-based firm’s assets under management, and is part of an overall effort to keep costs in line with revenues.

MFS says the cuts will help it weather the current market downturn, continue to invest in business opportunities to serve the firm’s clients, and emerge in the eventual economic recovery as a strong and competitive company.

Earlier this week, cross-town rival Putnam Investments announced it was going to reduce its workforce by 2%.

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RBC tweaks seg fund lineup

(November 21, 2008) RBC Insurance has announced several enhancements to its segregated funds product, which are effective back to October 1, 2008.

The changes include two new fund options — RBC Balanced Growth GIF and the RBC O’Shaughnessy All-Canadian Equity GIF — and a change to the underlying investments of the RBC Guaranteed Investment Portfolios.

“We believe these enhancements to our segregated funds product offering will be valued by clients who are looking for investment options that leverage the proven track record and world-class investment management of RBC Asset Management Inc, one of Canada’s top money managers,” said Tony Bagnato, vice-president of wealth management, RBC Life Insurance Company.

(11/21/08)