The federal government has no plans to intervene in the current proceedings to fix Canada’s third-party asset-backed commercial paper(ABCP)problem, according to Finance Minister Jim Flaherty.
A committee chaired by business veteran, Purdy Crawford, was formed in September to oversee the restructuring process of approximately $35 billion in non-bank-backed ABCP. The committee includes investors who were signatories to the so-called “Montreal Proposal”, plus other significant holders of the beleaguered investment vehicle.
“Our job is to keep people at the table,” said Flaherty, speaking to reporters in Toronto on Friday. Flaherty said he has met in recent weeks with the various parties involved, including the banks, the rating agencies, and holders of non-bank-backed asset-backed commercial paper.
In September, the committee indicated it would need more time to reach an agreement with the parties involved, including some of Canada’s largest institutional investors. Originally, the committee was given until October 15 to come up with a solution.
“This is a complex issue,” said Flaherty. “They may need more time. If so, then they’ll have more time. The important thing is to try to have an orderly market with adequate liquidity.” To read more about this issue, click here.
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