It’s possible that large private equity deals are impacting the investment choices available to the average Canadian institutional investor. By the time this article is published, there will undoubtedly have been at least one new takeover bid for a prominent Canadian publicly listed company. The flood of recent merger and acquisition activity is not solely […]
Issues of cost and risk are pushing plan sponsors to close off their DB plans. But that doesn’t mean managing them ends there. During this past year, the pension world has seen such heavy hitters as IBM, Verizon Communications, Sprint Nextel and even Nortel Networks decide to shut down or freeze their defined benefit(DB)plans in […]
With an ageing workforce and the rising costs of healthcare, is the possibility of a prefunded healthcare benefit a viable one? As of March, Bell Canada was the latest to target its postretirement benefits. Starting Jan. 1, 2012, the telecommunications company will eliminate most benefits for retirees over age 55. And it will eliminate all […]
Goodyear plans to freeze its defined benefit(DB)plans next year and replace them with enhanced 401(k)accounts. The company will also increase the amounts that current and future salaried retirees contribute toward the cost of their medical benefits, redesign retiree medical benefit plans to minimize cost impact on premiums, close its Medicare supplement plan to new entrants, […]
Canadians will expect to take various medications throughout their lives, but they’d rather not cough up to pay for them. In the Pollara-Health Care in Canada Survey, released before the end of last year, 89% of Canadians agree “employersponsored plans should pay for any drug that patients and their healthcare provider agree is the most […]
FOR SEVERAL YEARS, COMMENTATORS HAVE PREDICTED that companies will need to deal with the escalating cost of the health benefits they provide to their retirees. General Motors, which has recently incurred huge losses, provides health benefits for retirees that economist Paul Ginsburg refers to as “a relic from another era.” Taking its cue from the […]
Pension underfunding has become quite material for some Canadian firms and is having an influence on debt ratings, according to a report by Moody’s. “While on a stand-alone basis an underfunded pension plan will not drive the rating process, it does raise a red flag as to future funding requirements and their potential impact on […]
In 2000, Nortel Networks represented an ‘index-distorting’ one-third of the TSE 300 Index, creating undue risk for many funds. Some funds managed this risk by underweighting Nortel, which created active risk relative to their policy portfolio. Others chose a policy response, adopting a capped index that limited how much could be invested in a single […]
When beleaguered I.T. giant Nortel announced in June that it was switching its remaining defined benefit(DB) pension plan members to a defined contribution(DC)plan as of January 2008, many plan sponsors across the country were likely contemplating the same move. As DB plans struggle with funding deficits, many plan sponsors are weighing—and acting on—their options. According […]
One of the more interesting parts of the federal budget put out by Finance Minister Jim Flaherty in May was the proposal that budget surpluses should be used to help top-off the coffers of the Canada Pension Plan(CPP). But with any proposal out of Ottawa, there are differing opinions on what it could mean for […]