Industry officials debated when a global recession might kick in and whether the coronavirus would be the trigger.
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Major private equity firms, which have built up big distressed debt funds in recent years, are ready to snap up assets on the cheap if the coronavirus outbreak causes deeper market disruptions, executives told an industry meeting this week.
Distressed asset investment took centre stage at the SuperReturn conference in Berlin as financial markets reeled from investor panic over the coronavirus outbreak which has so far wiped $5 trillion off equities.
Industry officials debated when a global recession might kick in and whether the coronavirus would be the trigger.
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Billionaire private-equity chief Leon Black said his firm, Apollo Global Management, which built its reputation on investments made in the aftermath of the 2008 financial crisis, was ready to deploy funds in the event of a global recession.
“A downturn would not be a bad thing for Apollo,” he said during a panel discussion.
Apollo, which manages over $300 billion in assets, invested almost $50-billion in four months around the time of the 2008 financial crisis, and was prepared for a similar splurge should there be another downturn, he said.
“At this point in the cycle, you do have to keep an eye out for potential disruptions and we may already be seeing some of that coming to pass,” said Jason Thomas, global head of research at The Carlyle Group, a $225-billion private equity fund.
Funds could invest in company credit, loans in particular, which tend to decline proportionally to equity in a downturn even though it’s more senior in the capital structure, he said.
The more the senior the debt the higher the priority for repayment in the event of a bankruptcy.
“Credit becomes relatively undervalued, creating a buying opportunity irrespective of your views on the broader economy,” Carlyle’s Thomas said.
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KEEPING POWDER DRY
Many private equity firms have been building up distressed debt funds for several years, keeping a chunk of them on hold for a downturn. Such “dry powder” among distressed debt funds hit a record $77 billion globally in 2019, according to data from Preqin.
Some distressed debt specialists told Reuters in January that 2020 could be their year, with default rates tipped to rise and an expected increase in the number of companies that will struggle to service their debt.
The difficulty for these funds is predicting the end of what has been a long economic growth cycle. Many have been focusing on challenged sectors such as automobiles and energy instead of looking for a particular flashpoint in the economy.
“The automotive sector is facing a massive cyclical issue even before taking into account the coronavirus,” said Chris Boehringer, co-head of distressed debt for Europe at Oaktree Capital, a fund with $122-billion of assets under management.
“It is a sector that is used to 20-25 per cent of growth but was actually down 20 per cent last year. That, along with energy, are two sectors where we see a lot of dislocations potentially coming up and opportunities for us.”
One private equity executive at the conference, who is focused on distressed assets, told Reuters: “I signed up and expected to have meeting requests from six or seven others with a similar profile – instead, I had more than 50.”
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“Everyone here is trying to figure out when the cycle ends, if this time is different. Maybe coronavirus is the first trigger.”
Opinion was divided on whether coronavirus could prompt a downturn, with some saying the effect it has on supply chains could intensify an economic slowdown.
“Coronavirus could throw things off kilter a little but in terms of affecting certain industries we don’t know yet just how much. The best thing we can do right now is be prepared,” said Apollo’s Black.
TORONTO – Canada’s main stock index was up more than 250 points in late-morning trading, led by strength in the base metal and technology sectors, while U.S. stock markets also charged higher.
The S&P/TSX composite index was up 254.62 points at 23,847.22.
In New York, the Dow Jones industrial average was up 432.77 points at 41,935.87. The S&P 500 index was up 96.38 points at 5,714.64, while the Nasdaq composite was up 486.12 points at 18,059.42.
The Canadian dollar traded for 73.68 cents US compared with 73.58 cents US on Thursday.
The November crude oil contract was up 89 cents at US$70.77 per barrel and the October natural gas contract was down a penny at US2.27 per mmBTU.
The December gold contract was up US$9.40 at US$2,608.00 an ounce and the December copper contract was up four cents at US$4.33 a pound.
This report by The Canadian Press was first published Sept. 19, 2024.
Losing a loved one is never easy, and the legal steps that follow can add even more stress to an already difficult time.
For years, families in Vancouver (and Canada in general) have struggled with a complex probate process—filled with paperwork and legal challenges.
Thankfully, recent changes to Canada’s probate laws aim to make this process simpler and easier to navigate.
Let’s unearth how these updates can simplify the process for you and your family.
What is probate?
Probate might sound complicated, but it’s simply the legal process of settling someone’s estate after death.
Here’s how it works.
Validating the will. The court checks if the will is legal and valid.
Appointing an executor. If named in the will, the executor manages the estate. If not, the court appoints someone.
Settling debts and taxes. The executor (and you) pays debts and taxes before anything can be given.
Distributing the estate. Once everything is settled, the executor distributes the remaining assets according to the will or legal rules.
Probate ensures everything is done by the book, giving you peace of mind during a difficult time.
Recent Changes in Canadian Probate Laws
Several updates to probate law in the country are making the process smoother for you and your family.
Here’s a closer look at the fundamental changes that are making a real difference.
1) Virtual witnessing of wills
Now permanent in many provinces, including British Columbia, wills can be signed and witnessed remotely through video calls.
Such a change makes estate planning more accessible, especially for those in remote areas or with limited mobility.
2) Simplified process for small estates
Smaller estates, like those under 25,000 CAD in BC, now have a faster, simplified probate process.
Fewer forms and legal steps mean less hassle for families handling modest estates.
3) Substantial compliance for wills
Courts can now approve wills with minor errors if they reflect the person’s true intentions.
This update prevents unnecessary legal challenges and ensures the deceased’s wishes are respected.
These changes help make probate less stressful and more efficient for you and other families across Canada.
The Probate Process and You: The Role of a Probate Lawyer
(Image: Freepik.com)
Working with a probate lawyer in Vancouver can significantly simplify the probate process, especially given the city’s complex legal landscape.
Here’s how they can help.
Navigating the legal process
Probate lawyers ensure all legal steps are followed, preventing costly mistakes and ensuring the estate is managed properly.
Handling paperwork and deadlines
They manage all the paperwork and court deadlines, taking the burden off of you during this difficult time.
Resolving disputes
If conflicts arise, probate lawyers resolve them, avoiding legal battles.
Providing you peace of mind
With a probate lawyer’s expertise, you can trust that the estate is being handled efficiently and according to the law.
With a skilled probate lawyer, you can ensure the entire process is smooth and stress-free.
Why These Changes Matter
The updates to probate law make a big difference for Canadian families. Here’s why.
Less stress for you. Simplified processes mean you can focus on grieving, not paperwork.
Faster estate settlements. Estates are settled more quickly, so beneficiaries don’t face long delays.
Fewer disputes. Courts can now honor will with minor errors, reducing family conflicts.
Accessible for everyone. Virtual witnessing and easier rules for small estates make probate more accessible for everyone, no matter where you live.
With these changes, probate becomes smoother and more manageable for you and your family.
How to Prepare for the Probate Process
Even with the recent changes, being prepared makes probate smoother. Here are a few steps to help you prepare.
Create a will. Ensure a valid will is in place to avoid complications.
Choose an executor. Pick someone responsible for managing the estate and discuss their role with them.
Organize documents. Keep key financial and legal documents in one place for easy access.
Talk to your family. Have open conversations with your family to prevent future misunderstandings.
Get legal advice. Consult with a probate lawyer to ensure everything is legally sound and up-to-date.
These simple steps make the probate process easier for everyone involved.
Wrapping Up: Making Probate Easier in Vancouver
Recent updates in probate law are simplifying the process for families, from virtual witnessing to easier estate rules. These reforms are designed to ease the burden, helping you focus on what matters—grieving and respecting your dead loved ones’ final wishes.
Despite these changes, it’s best to consult a probate lawyer to ensure you can manage everything properly. Remember, they’re here to help you during this difficult time.
TORONTO – Canada’s main stock index was higher in late-morning trading, helped by strength in energy stocks, while U.S. stock markets also moved up.
The S&P/TSX composite index was up 34.91 points at 23,736.98.
In New York, the Dow Jones industrial average was up 178.05 points at 41,800.13. The S&P 500 index was up 28.38 points at 5,661.47, while the Nasdaq composite was up 133.17 points at 17,725.30.
The Canadian dollar traded for 73.56 cents US compared with 73.57 cents US on Monday.
The November crude oil contract was up 68 cents at US$69.70 per barrel and the October natural gas contract was up three cents at US$2.40 per mmBTU.
The December gold contract was down US$7.80 at US$2,601.10 an ounce and the December copper contract was up a penny at US$4.28 a pound.
This report by The Canadian Press was first published Sept. 17, 2024.
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