Federal Finance Minister Jim Flaherty delivered an upbeat assessment of Canada’s economy at the Canada Cup of Investment Management in Toronto on Friday.
He said that aside from the struggling auto sector, the current American economic malaise will not be duplicated in Canada thanks to healthy levels of household debt and strong banking and housing sectors. Flaherty added that Canada is one of the few countries in the world with sound public pension plans.
He also praised the recent court approval for the third-party asset backed commercial paper market, a development he described as a great success for Canada. “I always encourage a private-sector solution to a private-sector problem,” Flaherty said.
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HOOPP in Ducati Acquisition
The three main shareholders of famed motorcycle firm Ducati, including the Hospitals of Ontario Pension Plan (HOOPP), will end up with nearly 85% of the company after other shareholders took up their offer to buy them out.
HOOPP, Investindustrial, and BS Investimenti offered in February to buy the 70% of Ducati they did not own.
Their offer, worth more than €390 million (C$624.27 million) had been accepted by holders of a combined 55.2% of Ducati, increasing their entire holding to 84.7%.
The company has been struggling since 2005, and is currently restructuring its operations in order to meet ambitious targets for 2010.
Prior to the offer, Investindustrial owned 15.6% of Ducati, while HOOPP had 7.4% and BS Investimenti about 7%.
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Retirees Hesitant to Spend their Savings
Fifty-seven percent of U.S. retirees are living on Social Security and pensions alone—leaving a significant chunk of their retirement nest egg untouched, according to a report.
Nationwide Financial’s Retirement Income Confidence Survey found that almost a quarter of retirees who live solely on Social Security and pensions are afraid to dip into their retirement investments, presenting a new challenge to financial professionals to help clients use their accumulated wealth to generate income.
“It’s natural for consumers to have a tendency to play it safe when it comes to their nest eggs,” says John Carter, president of Nationwide Financial Distributors. “But an overly conservative approach can also mean they’re not fully utilizing the resources available to them, leaving themselves potentially vulnerable to market, inflation or longevity risk.”
The survey also found 47% of retirees and pre-retirees are not sure their retirement income will be sufficient, and fewer than one in five put their chances of having enough money to live on comfortably in retirement at 100%. Only 37% believe their income investments returns are predictable, and less than half are “very sure” they have the right mix of retirement investments.
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New Regulatory Body Announced
The Investment Industry Regulatory Organization of Canada (IIROC) has commenced operations as the self-regulatory organization overseeing all investment dealers and trading activity on equity and debt marketplaces in Canada.
IIROC was created through the consolidation of the Investment Dealers Association of Canada and Market Regulation Services Inc.
IIROC will regulate the educational proficiency and business and financial conduct of investment dealers and their registered representatives, and will monitor in real time and on a post-trade basis all trading activity on the following marketplaces for compliance with market integrity rules: The Toronto Stock Exchange; The TSX Venture Exchange; Canadian Trading and Quotation System (including its ‘Pure Trading’ facility); Bloomberg Tradebook Canada Company; Liquidnet Canada Inc; BlockBook; MATCH Now; OMEGA ATS; and Chi-X Canada.
“Merging market and member regulation into a national self-regulatory organization is a significant step towards modernizing, simplifying and strengthening Canada’s self-regulatory system,” says Susan Wolburgh Jenah, president and chief executive officer of IIROC. “New products, new trading systems and new technologies must be matched by a more integrated approach to regulation.”
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New TSX Group CEO Appointed
The board of directors of TSX Group named Thomas A. Kloet as its new chief executive officer.
He has spent the last five years as the senior executive vice-president and chief operating officer of financial services firm Fimat USA, and will assume his position next month pending immigration procedures.
“I am thrilled to be assuming the exciting challenge of integrating the newly combined businesses of TSX Group and Montreal Exchange and taking TMX Group forward to an increased presence on the global stage,” says Kloet.
Kloet replaces Richard Nesbitt, who recently moved to CIBC World Markets.