PrefBlog

I was interested to read the following in the IAIS document Insurance Core Principles and Common Framework for the Supervision of Internationally Active Insurance Groups:

17.2.5 Regulatory capital resources protect the interests of policyholders by meeting the following two objectives:
• reducing the probability of insolvency by absorbing losses on a going concern basis or in solvent run-off; and/or
• reducing the loss to policyholders in the event of liquidation or resolution.
17.2.6 The extent to which capital elements (as described in Figure 17.3) achieve the above objectives will vary depending on their characteristics or quality. For example, ordinary share capital may be viewed as achieving both objectives, whereas subordinated debt may be viewed largely as only protecting policyholders in insolvency. Capital resources that achieve both objectives are sometimes termed “core regulatory capital resources” or similar (see Guidance 17.11.37) and capital resources that only reduce the loss to policyholders in liquidation or resolution are generally termed “winding-up capital” or “gone concern capital”. It would be expected that core regulatory capital resources should form the substantial part of capital resources.

I continue to hope to see the day when the banks’ NVCC rules are applied to insurers, as this will reduce the probability of insolvency by absorbing losses on a going concern basis or in solvent run-off.

Oh, and I just noticed this press release from the OSC dated 2024-11-27:

The Ontario Securities Commission (OSC) is announcing it will provide funding of up to $2 million per year, to a total of $11 million, to FAIR Canada (FAIR) – a national charitable organization dedicated to advancing and promoting the interests of individual investors. This new funding arrangement will provide a stable source of funding for FAIR for the next six years.

“FAIR provides an important and independent voice for investors, advocating for their interests on securities policy issues,” said Grant Vingoe, OSC CEO. “This contribution provides a steady and stable source of funding over the next six years to support FAIR with its important work.”

The funding will be provided from sanction and settlement funds held by the Commission in two installments, the first of which will be paid to FAIR immediately, with a second installment provided in 2027. FAIR can only draw a maximum of $2 million per year under the agreement. This funding will be used to support FAIR’s day-to-day operations.

The mandate of the OSC is to provide protection to investors from unfair, improper or fraudulent practices, to foster fair, efficient and competitive capital markets and confidence in the capital markets, to foster capital formation, and to contribute to the stability of the financial system and the reduction of systemic risk. Investors are urged to check the registration of any persons or company offering an investment opportunity and to review the OSC investor materials available at https://www.osc.ca.

Looking at the FAIRCanada website’s “Team” page we find:

Jean-Paul is the Executive Director, President and CEO of FAIR Canada. Prior to joining FAIR Canada in 2020, he was a financial sector expert at the World Bank Group assisting countries to enhance their securities regulatory regimes. He is a former member of the Executive Management Team at the Ontario Securities Commission, where he worked for 20 years in senior leadership and policy roles. He began his legal career at a national law firm advising clients on securities law matters.

and

Pira Kumarasamy brings a wealth of experience in communications, media relations, and strategic social media planning. With a strong background in agency work and consulting, she has led impactful communications projects across various industries. Before joining FAIR Canada, Pira served as Senior Manager, Communications and Public Affairs at The Investment Funds Institute of Canada (now called Securities and Investment Management Association). She has also freelanced as a writer and consultant for fintech and personal finance publications.

and

Prior to joining FAIR Canada, Bruce worked in-house as a lawyer at a Toronto Stock Exchange-listed reporting issuer headquartered in Edmonton. In this role, Bruce’s main responsibilities included corporate finance transactions, public disclosure, public company and subsidiary governance, and corporate reorganizations. During part of his tenure at the organization, he also served as Assistant Corporate Secretary. Bruce began his career at a private firm in Edmonton, where he worked on a variety of corporate and commercial matters. He is a member of the Law Society of Alberta.

So of the four “team” members, one is an ex-OSC honcho and two were employed by elements of the investment industry Family Compact. It’s so nice that the OSC is cutting cheques to ensure their continued employment!

TXPR closed at 676.09, down 0.72% on the day. Volume today was 1.96-million, second-highest of the past 21 trading days.

CPD closed at 13.40, down 0.67% on the day. Volume was 49,200, well above the median of the past 21 trading days.

ZPR closed at 11.855, down 0.80% on the day. Volume was 146,500, third-highest of the past 21 trading days.

Five-year Canada yields were down 3bp to 2.80%.

The rather late September US jobs number is getting mixed reviews:

The economy added 119,000 jobs in September, more than double what forecasters had expected and well above the 71,000-job average for the rest of 2025. Numbers for the previous two months were revised down slightly, erasing 33,000 job gains from July and August, which made September look more like an acceleration.

However, the strength was not widely distributed.

As has been the case for the past two years, job growth was largely supplied by the health care industry, which added 43,000 jobs. Bars and restaurants added 37,000, an indication of robust spending on hospitality services.

Both of those sectors are tied to an economy that is aging and lately powered by higher-income consumers, who have been spending freely on discretionary services while those on the lower end of the income spectrum struggle to keep up with their bills.

The equities market responded with uncertainty:

Bullish investors lost their nerve on Thursday and a brief rally in stocks went into reverse as concerns about overvalued A.I. companies crept back into the market.

The midday fade came after strong gains in early morning trading in what investors and analysts initially attributed to relief after solid earnings reports from Nvidia, the flag-bearer of the move toward artificial intelligence that has propelled technology stock prices higher, and Walmart, a bellwether of consumer health.

But investors’ early enthusiasm quickly gave way to afternoon selling pressure.

The S&P 500 tumbled after climbing as much as 1.9 percent in morning trading. The benchmark ended the day 1.6 percent lower, a reversal of more than 3 percent from its highest point.

Sorry this is late!

TXPR closed at 681.02, down 0.59% on the day. Volume today was 1.37-million, third-highest of the past 21 trading days.

CPD closed at 13.49, down 1.46% on the day. Volume was 34,101, below the median of the past 21 trading days.

ZPR closed at 11.95, down 0.83% on the day. Volume was 86,360, below the median of the past 21 trading days.

Five-year Canada yields were up to 2.83%.