Tausi Insider

Romspen, one of Canada’s biggest private mortgage lenders, with $3.2-billion in assets under management, is freezing investor redemptions, citing some trouble with loan repayments. The act of freezing redemptions, known as “gating” in the investment industry, prevents investors from taking their money out of the fund. Because Romspen is a private lender, a preset mechanism for redemptions normally permits a certain amount to be paid back to investors each month. The company has not said how long the freeze will last. Instead, it told investors this week that it will “temporarily defer payment of unit redemptions requests until there is more clarity with respect to the fund’s timetable for borrower loan repayments and the receipt of proceeds of collateral and asset monetizations.” Romspen’s portfolio largely comprises construction and predevelopment loans, and it lends to borrowers across the United States and Canada. In its letter to investors, the company warned that “if redemption...

A man looks at a Bloomberg terminal. BEN FATHERS/AFP/Getty Images David McLean is the Owner of McLean Asset Management and Manager of the ROMC Fund . Active investment funds have been overcharging investors for decades. Nowhere is this more prominent than in the alternative fund category, colloquially known as hedge funds. Investment management used to be a profession. Today, it’s a business. Traditionally, fund management companies offered but one fund, managed for long-term maximum real return after taxes, in order to increase purchasing power for savers. Today, a typical manager offers hundreds of funds. And as what used to be a craft devolves into a numbers game, the whole industry has weakened. Assets in the hedge-fund industry have fallen by nearly US$220-billion since the end of 2021, with global economic conditions leading to poor performance, and investors redeeming funds in droves as a result. Two of the world’s richest, most successful investment managers, Warren Buffett a...

Minister of Environment and Climate Change Steven Guilbeault takes part in a news conference in Ottawa, on Sept. 15. Adrian Wyld/The Canadian Press Canada’s Environment Minister said he sees at least one advantage of using an emissions cap over a pricing system to bring down the oil and gas industry’s burgeoning output of greenhouse gas. In an interview on Monday with Tausi Insider at the COP27 climate conference in Egypt, Steven Guilbeault, who has been Minister of Environment and Climate Change for a year, said “one of the advantages of a cap is emissions reduction certainty,” that is, a cap would allow the government to predict with some degree of accuracy that Canada’s emissions targets would be met. Canada is struggling to reduce its carbon output by at least 40 per cent by 2030 and achieve net-zero emissions by 2050. The government wants the oil and gas industry to cut its emissions by 42 per cent from 2019′s levels by 2030. A modified carbon pricing system is the alternative t...

Brookfield Asset Management Inc.’s renewables affiliate is committing to invest up to US$700-million in a newly formed U.S. recycling business, targeting recycled materials as part of the push to cut global carbon emissions. Brookfield Renewable Partners LP has invested an initial US$200-million for a minority stake in Circular Services, a new company that is majority owned and managed by New York-based investment firm Closed Loop Partners. Brookfield Renewable is also committing to invest another US$500-million to help Circular Services grow. The investment is being made through the US$15-billion Brookfield Global Transition Fund, which is co-led by vice chair and former Bank of Canada governor Mark Carney and Brookfield Renewable CEO Connor Teskey. It is Brookfield’s first fund focused on investments intended to help speed the transition to a net-zero economy. Circular Services owns and operates a dozen municipal recycling facilities in the United States. And it has large municipa...

Activists participate in a protest at the COP27 UN Climate Summit on Nov. 18, in Sharm el-Sheikh, Egypt. Peter Dejong/The Associated Press The COP27 negotiations in Egypt remained in deadlock late on Friday, the day the UN-sponsored climate conference was to finish, in spite of a late intervention by the European Union to help developing countries pay for the damages inflicted by catastrophic climate events with a so-called loss and damage fund. The talks have been extended until Saturday. Delegates and environmental groups on Friday afternoon, local time, said that the summit faced collapse unless breakthroughs were made in the commitment to launch such a fund, and in the effort, also from developing countries, to ensure that any final agreement calls for the gradual elimination of all fossil fuels, not just coal. “The success or failure of this COP27 depends on the equitable phase-out of all fossil fuels,” Catherine Abreu, founder of the environmental group Destination Zero and a m...

Insurance regulators are reviewing the industry’s practice of paying upfront commissions to advisers who sell segregated funds, as investor advocates argue the payments should be banned outright due to a conflict of interest that can harm financial outcomes of clients. The Canadian Council of Insurance Regulators (CCIR) and the Canadian Insurance Services Regulatory Organization (CISRO) are conducting a joint consultation on the use of upfront commissions – also known as chargebacks – in the sale of segregated funds. The review is looking at the impact of banning upfront commissions or whether other measures can be taken to improve investor outcomes. A chargeback is an upfront commission a life insurer or other fund provider pays directly to a financial adviser on the sale of a segregated fund, which locks the client’s money into a contract for an allotted period of time, typically for longer than 4 years. The upfront commission can range from 3 to 7 per cent of a client’s total depo...

Cryptocurrency exchange Binance said on Thursday it was committing $1-billion to establishing an industry recovery initiative (IRI) to invest in companies from the digital assets sector. The move comes at a time when the crypto market is teetering from the collapse of FTX, which is seeking Chapter 11 bankruptcy protection in the United States. The unraveling of one of the biggest crypto exchanges in the world has also fanned worries around the industry’s continued ability to draw investments from venture capital and private equity giants. Binance said it intends to ramp up its commitment amount to $2-billion in the near future depending on need. “We anticipate this initiative will last about six months and will be flexible on the investment structure – token, fiat, equity, convertible instruments, debt, credit lines, etc,” the crypto exchange added in a statement. Zhao said while speaking at a conference in Abu Dhabi last week that there was significant interest from industry players...

A security personnel stands guard next to a COP27 sign during the closing plenary at the climate summit, in Red Sea resort of Sharm el-Sheikh, Egypt, on Nov. 20. MOHAMED ABD EL GHANY/Reuters The first United Nations climate conference I covered was the 2009 COP15 dud in Copenhagen. Since then, I have worked the conference mob scenes in Paris, Madrid and, earlier this month, Sharm el-Sheikh, Egypt. They were duds, too, in the sense that none ended with formal agreements to reduce fossil-fuel use – the only metric that matters as average global temperatures rise to dangerous levels. The annual COPs have turned into chaotic, bloated carnivals where, in their final desperate hours (most of them go into overtime) the distraught host-country presidency produces a face-saving agreement that allows it to declare a victory of some sort – or at least deflect some of the criticism that the outcome was a total failure. Even a breakthrough that barely fits the definition is billed as a win, sinc...

Courtney Robinson is the global head of financial inclusion for Block (formerly Square, Inc.) and Leslie Jackson is the head of policy for Block in Canada Social-impact investing is a mostly misunderstood and underutilized way for a company to support the communities it serves by amplifying its power to pay it forward. But it is on the rise: The Global Impact Investing Network, which advocates for increasing its scale and effectiveness, estimates that the size of the worldwide impact investing market has topped US$1-trillion. By definition, s ocial-impact investments are made with the intention to generate positive, measurable social consequences. By allocating capital to ventures that are expected to yield social benefit, such as advancing important community goals, social-impact investing provides corporate investors with a way to generate returns and do good at the same time. In contrast to traditional giving, social-impact investing is directed toward organizations that have cl...

Canadian pension giant Caisse de dépôt et placement du Québec is raising its bet on construction company Pomerleau as the privately held builder pushes out from its home market in a bid to grab a bigger share of the country’s infrastructure spending pie. The Caisse is making a new $150-million equity investment in Saint-Georges, Que.-based Pomerleau to support its pan-Canadian growth plan, the two companies said in a statement Wednesday. Some of the money will be used to fund Pomerleau’s recently announced takeover of Vancouver-based ITC Construction Group, known for building dozens of residential towers making up the skylines in western cities such as Vancouver and Calgary. A portion will also be earmarked for other growth efforts as Pomerleau seeks to expand its work force of 4,000 employees and add to its current $4-billion in annual revenue. The new funds come on top of $50-million the Caisse injected into the company in 2018, bringing its total equity investment to $200-million ...

Alberta’s government-owned asset manager landed Marlene Puffer as its new chief investment officer on Tuesday, luring her away from the top job at Canadian National Railway Co.’s CNR-T pension plan. Mr. Puffer joins the Alberta Investment Management Corp. (AIMCo) at a time when the Alberta government is adding money and new clients to the $160-billion fund. AIMCo manages money for 32 groups, including civil-servant pension plans and the province’s $18-billion Heritage Savings Trust Fund. “I am delighted to have Marlene join AIMCo. She is both a fantastic addition to the company and a complement to our leadership team,” said Evan Siddall, chief executive officer of AIMCo, in a press release. Ms. Puffer will join the Edmonton-based fund manager at the end of January. Ms. Puffer was previously CEO at the $19-billion CN Investment Division, which runs the Montreal-based railway’s pension plan. She also served as vice-chair of the Healthcare of Ontario Pension Plan and worked at several p...

Courtney Robinson is the global head of financial inclusion for Block (formerly Square, Inc.) Private sector can inspiration from public sector book on how to invest purposefully in communities. Mark Blinch/Reuters You’ve probably heard the popular refrain that the private sector has a lot to teach the public sector, particularly in the innovation arena. But, when it comes to social-impact investing, the opposite is true – the private sector can draw inspiration and learn from the public one. I learned these lessons first-hand during my time as counsel at the Center for Responsible Lending and as senior counsel on the financial services committee in the U.S. House of Representatives. When Block’s treasury team was looking for a purposeful way to invest, I was able to share my experience in the public sector working with community development financial institutions. What began as a pilot US$5-million Community Development Financial Institution (CDFI) investment, led by our treasury a...

Environmental, social and governance investing has been engulfed by suspicion and acrimony this year. That could be for the best. If anything, the turmoil in ESG has helped investors and the public better understand what it is, and what it is not, as the world grapples with social inequity and a climate crisis. At its core, ESG is a series of measures used to determine if a company or fund is protected against non-financial and policy-related risks tied to climate change, worker safety, boardroom diversity and other factors. It is slowly becoming more specifically categorized. “I think these are much-overdue growing pains,” said Alexandria Fisher, an Edmonton-based ESG risk-management expert. “It’s a clear signal that the area is maturing from something that is kind of greenwashing into something that is more robust and is creating a better picture for risk management.” As ESG-themed investment chilled in 2022, questions emerged about just how effective it is in transforming the busi...

Bank of Montreal’s BMO-T asset management arm is launching a new fund with Toronto-based tech financier Georgian Partners that aims to give a broader array of investors a gateway to invest in privately held technology companies. The new BMO-branded fund will allow accredited investors – often those with high incomes or more than $1-million of available assets – to invest in Georgian’s portfolio of more-established North American tech companies. Georgian typically backs fast-growing, private software companies that have matured past the startup stage, in sectors such as cybersecurity and industrial automation. The new fund is part of a push by BMO to build up its offerings in alternative investments – an increasingly popular array of assets such as infrastructure, real estate and private lending that are distinct from public stocks and bonds. It is BMO’s first such partnership with a private-market investor on a product that can be sold to investors through BMO’s network of advisers, ...

The S&P/TSX 60′s top stocks, based on their weightings, are like a wish list of solid performers, including Canadian National Railway Co. Mark Blinch/Reuters Canadian banks, oil producers, railways and pipelines look like fine sectors to ride out the economic turmoil ahead, given their mix of reasonable valuations, strong cash generation and rising dividends. So, why not grab them all with a fund that tracks the S&P/TSX 60 Index? The benefits of passive investing – a strategy based on accepting the returns of the market, rather than trying to outperform it with active stock selection – are well known. But the appeal of Canada’s blue-chip index looks particularly strong in 2023, given the index’s exposure to companies that can survive an oncoming recession and reap the benefits of an economic recovery, all while paying out hefty dividends. The S&P/TSX 60′s top stocks, based on their weightings, are like a wish list of solid performers, including Royal Bank of Canada RY-T, ...