The Ontario Superior Court of Justice has sanctioned the plan to restructure $32-billion of third-party asset-backed commercial paper (ABCP) issued by 20 of the conduits that are the subject of last summer’s Montreal Accord.
Justice Colin Campbell also accepted a proposed amendment to the plan that would allow certain noteholders, under specified conditions, to pursue claims of fraud against ABCP dealers.
He noted he was satisfied with the efforts of the committee and other participants in the plan including certain dealers of ABCP to deal with individual cases of hardship.
“We are gratified that the Court has approved the restructuring plan and determined that is was fair,” said Purdy Crawford, chair of the Pan-Canadian Investors Committee for Third-Party Structured ABCP. “After nine months of arduous negotiations with, and compromise among all stakeholders, we are poised to bring this process to a successful conclusion for the benefit of noteholders.”
Implementation of the restructuring plan is expected to be completed by the end of June.
For more about the ongoing ABCP story, click here to read our special section, The Paper Chase.
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CIBC Expects TSX to Reach New High
The S&P/TSX composite index will reach a record high of 15,200 by the end of the year because of strong oil prices, according to a CIBC World Markets report.
It finds that the jump in oil prices over the past year has been driven by supply and demand fundamentals, not by speculation or a weak U.S. dollar as others have suggested.
“The claim that the rise in commodity prices is largely just the inverse of U.S. dollar weakness also seems dubious since oil has risen strongly against other currencies,” says Jeff Rubin, chief strategist and chief economist at CIBC World Markets.
The brokerage expects crude (West Texas Intermediate) to average US$115 per barrel this year. So far in 2008, oil has averaged $107 a barrel.
The report also notes that global oil demand continues to grow. The drop in oil consumption in North America, Japan and Europe due to high prices will continue to be more than offset by growth not only from Brazil, Russia, India and China, but also from highly subsidized consumers in many Middle Eastern countries.
To read the report on CIBC World Markets’ website, click here.
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OAS Benefits Rise
The basic Old Age Security (OAS) pension will be $505.83 per month—an increase of 0.7% over the previous quarter—as of July 1, 2008, says Human Resources and Social Development Canada.
OAS benefits are revised quarterly (in January, April, July and October) to reflect any increases in the cost of living as measured by the consumer price index. If there is no increase, benefit rates stay at the same level.
Old Age Security includes the Guaranteed Income Supplement (GIS) and the Allowance; these payments will also increase by 0.7%.
OAS provided 4.4 million seniors with approximately $30 billion in 2006-2007.
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Scotia Capital Forms Alliance
Scotia Capital has traveled across the pond to enter a strategic investment banking alliance with London-based Oriel Securities.
The two companies will work together to assist firms looking to access equity capital markets in Canada, the United States and the United Kingdom through initial public offerings and follow-on fundraising on the Toronto Stock Exchange, AIM, the New York Stock Exchange and other bourses.
“We are pleased to have found a partner that will assist us in expanding the level of service we can provide to our North American and international clients looking to access the U.K. equity markets,” says Philip Smith, managing director at Scotia Capital and head, corporate and investment banking.
Oriel Securities is and independent institutional and corporate stockbroking and advisory firm.