The Office of the Superintendent of Financial Institutions (OSFI) has reduced the number of private pension plans on its watch list.
According to its 2007-2008 annual report, there are now 59 plans on that list, down from 63 at the start of the year.
Of these, 49 were defined benefit plans (49 in 2006-2007) and 10 were defined contribution plans (14 in 2006-2007). During the course of 2007-2008, 10 new plans were added to the watch list and 14 were removed, in part due to OSFI’s intervention.
“In 2007-2008, OSFI intervened with respect to high-risk pension plans, including taking measures to enforce minimum funding requirements and ensure timely remittance of contributions,” says the annual report. “OSFI also used its authority to require a number of plans to provide enhanced and prompt disclosure of financial information to members.”
Pension plans that give rise to serious concern, due to their financial condition or for other reasons, are placed on a watch list and are actively monitored.
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Teachers’ Unit Buys Political and Advisory Firm
A subsidiary of the Ontario Teachers’ Pension Plan—Glass, Lewis & Co.—has agreed to acquire Washington Analysis Corporation, a political and economic advisory firm based in Washington, D.C.
Financial terms of the deal were not disclosed.
The agreement to acquire Washington Analysis is with Xinhua Finance Limited of Shanghai and is subject to certain closing conditions. The transaction is expected to close by the end of the quarter, at which time Washington Analysis will become a wholly-owned subsidiary of Glass Lewis.
“More than ever, investors are looking for unique insight into the risks within their portfolios,” says Katherine Rabin, chief executive officer of Glass Lewis. “The combination of Glass Lewis and Washington Analysis will enable institutions to have an unparalleled, comprehensive understanding of the risks at public companies—including business, governance, accounting, legal and political risks.”
This isn’t the only deal between Teachers’ and Xinhua Finance Limited in recent years. In 2007, it purchased Glass Lewis from Xinhua for US$46 million.
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Central Banks Should Work in Tandem, Dodge Says
Central banks need to devote more effort to monitoring and assessing financial market developments, including market and institutional liquidity issues, and discussing these developments with other relevant agencies, according to David Dodge.
“Central banks are in the best position to assess and analyze macrofinancial developments and to make this analysis available to other agencies and the private sector,” the former Bank of Canada governor said during a lecture to the C.D. Howe Institute on Tuesday.
He added that other financial regulatory agencies and the financial institutions themselves also have an important role to play in stabilizing financial and credit markets.
“Even more importantly,” Dodge explained, “the time has come for G20 leaders to put their weight behind a strengthened international monetary system and increased international co-operation among treasuries, central banks, financial regulatory agencies and the financial institutions themselves.”
To read the lecture on the C.D. Howe Institute’s website, click here.
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Franklin Templeton, AIC Launch TFSAs
More financial institutions are rolling out their tax-free savings accounts (TFSAs) every day, so clients can be ready on Jan. 2 to deposit their money. Franklin Templeton and AIC say their TFSAs are now ready.
Although investors can’t yet put money—up to $5,000—into an account, they can submit an application to open one up.
Jonathan Wellum, CEO and CIO of AIC, says now is the best time to create a TFSA account, as down markets offer lots of opportunity.
“Given the recent market turmoil and the fact that valuations are quite low, now is an ideal time for value investors to consider establishing a TFSA,” he says. “History has shown that markets traditionally rebound, so this current period sets the stage for potential growth for value investors.”
“The new TFSA helps you save for your short-term and long-term goals, while avoiding paying tax on your investment income along the way, even if withdrawn,” adds Dennis Tew, Franklin Templeton’s CEO. “If you are saving for a wedding or a cruise in a year or two, or looking far ahead to retirement, the TFSA lets you save and spend when you want, where you want—tax-free.”