Briefly:

Previous Brieflies this week: | MON | TUE | WED | THURS |

(May 9, 2007) BMO Capital Markets is still in damage control after it reported trading losses that could be as high as $450 million. The bank says it is conducting an external review of its trading activities and will be suspending all business relationships with the brokerage firm Optionable Inc., including all derivatives trading through that firm.

Optionable is not the only one facing the axe. BMO confirmed that two of its traders involved in the bungled strategy on natural gas derivatives are on leave pending the results of the external review.

In addition, the company said that it has changed the operating structure of BMO Capital Markets in order to provide additional oversight of the commodities business.

• • •

OSFI issues warning about deposit scheme

(May 9, 2007) The Office of the Superintendent of Financial Institutions has issued a warning about a Peterborough, Ontario-based company that is trying to offer insured deposits to Canadian investors.

OSFI says Borealis International, which is not a federally regulated financial institution, is soliciting deposits that it claims are “guaranteed by a Canadian Trust” and will grow 10% to 18% per year. The company’s website says the deposits were insured by one of the world’s largest reinsurance companies and the deposits were being offered by Atlantic Trust Company.

OSFI says that Atlantic Trust Company is a registered corporation in Prince Edward Island, but the trust denied having any relation to Borealis whatsoever. Even if it did, OSFI points out that Atlantic Trust is not a member of the Canada Deposit Insurance Company and is therefore not authorized to accept deposits.

Borealis is suspected of being an advance fee or “Nigerian letter” scam, where investors are required to put money up front, and once they do, they never see it again. The OSFI advises investors never to make an advance payment for purposes of opening an account or paying a government fee. In addition, it suggests investors be wary of companies that ask to have money transferred to individuals. Real financial entities would request money transfers in the company’s name.

• • •

Russell launches income-yielding portfolio

(May 9, 2007) Russell Investments Canada has launched the new LifePoints Balanced Portfolio, which will offer a 50-50 diversified balance of fixed income and equities.

Russell says that along with potential investment growth, holders also have access to a 6% distribution option for a tax-efficient monthly cash flow.

“The LifePoints Balanced Portfolio is ideal for investors who want a moderate-risk, diversified investment that delivers long-term results,” says Sadiq Adatia, who manages the LifePoints Portfolios.

Russell highlights that LifePoints is also available in three Target Date Portfolios: LifePoints 2010 Portfolio, LifePoints 2020 Portfolio and LifePoints 2030 Portfolio.

• • •

RBC, AIM Trimark launch PPNs

(May 9, 2007) RBC announced on Wednesday the launch of the RBC AIM Trimark Global Balanced Deposit Notes Series 1 and 2, which are aimed at risk-adverse investors seeking to diversify their portfolio with global exposure.

The notes are principal protected and linked to the performance of a notional portfolio composed of units of the Trimark Global Balanced Fund and potentially bonds, if needed to guarantee the principal, RBC says.

Series 1 notes will provide monthly coupon income, while the Series 2 notes will provide monthly partial principal repayments, equivalent in both instances to 5.04% of the fund holdings in the portfolio. Both series are available to individual investors as well as through investment advisors and financial planners until June 29, 2007. The maturity date of the notes is January 5, 2015.

• • •

(05/09/07)