Large companies that receive bridge financing through a new federal loan program will have to give the government the option to take an ownership stake, or provide a cash equivalent.
Finance Minister Bill Morneau says the terms will be the same for any company asking for help through the Large Employer Emergency Financing Facility (LEEFF) program that opens for applications today.
Support for Canada’s largest employers is here. Today, we are opening applications for the #LEEFF program to protect Canadian jobs and help businesses weather the current economic challenges. Read more: https://t.co/E76ZwtmKx5
— Bill Morneau (@Bill_Morneau) May 20, 2020
He says the terms are designed to make sure companies using the program receive bridge loans, not bailouts, to get through COVID-19’s economic disruptions.
The Liberals have said the loans would be on commercial terms, and require companies to have already gone to banks or the market and been unable to meet their financial needs.
Recipients would also have to agree to limits on executive compensation, dividend payments and share buy-backs, as well as show they are contributing to the Liberals’ goal of reducing greenhouse-gas emissions.
Morneau says the loan program for Canada’s largest corporations is so they can stay open and keep employees on their payrolls and to avoid bankruptcies of otherwise viable firms, wherever possible.
The federal government is also expected to announce later in the day rent relief for small- and mid-sized businesses.
Today’s focus follows last week’s extension of the 75 per cent wage subsidy for three months, to the end of August, and Tuesday’s announcement that the government is expanding the eligibility criteria for its small business loan program.
The latter program provides interest-free loans of $40,000 for eligible small businesses to cover costs like rent and utilities, with the possibility of forgiving one-quarter of the amount if it is paid off by the end of 2022.
Tuesday’s fix extended the program to companies that don’t have traditional payrolls, such as family-run businesses that pay themselves in dividends and companies that employ only contractors.
“This is about getting people back to work and giving businesses the confidence to reopen, rehire and even grow because the way our economy will recover and the way our country will remain resilient and successful is by getting Canadians back to work,” Prime Minister Justin Trudeau said Tuesday.
Today’s focus on rent relief and the large corporation loans program is aimed at conveying the same message.
The LEEFF program was announced last week, aimed at providing short-term bridge financing to companies with $300-million or more in annual revenues looking for loans worth at least $60 million but unable to secure them from banks or other private lenders.
Trudeau has also said applicants whose financial records show signs of “aggressive tax avoidance” will be prohibited, as will companies convicted of tax evasion in the past.
While the LEEFF program was generally well received last week, many companies said they had to wait for the details before knowing whether it would be of use to them.
The government had hoped it would be used by airlines to stay afloat during the pandemic, which has brought air travel to a virtual standstill. But late last week Air Canada announced plans to lay off about 20,000 employees.
Under the commercial rent relief program, landlords are to apply for a 50 per cent subsidy paid for by federal and provincial governments, with tenants paying another 25 per cent. But critics have said many landlords, who would have to accept a 25 per cent reduction in the rent they receive, have refused to participate.
CPA Canada hit by cyberattack, affecting data of more than 329000 – CP24 Toronto's Breaking News
The Canadian Press
Published Thursday, June 4, 2020 4:15PM EDT
Last Updated Thursday, June 4, 2020 5:41PM EDT
TORONTO – A cyberattack on the Chartered Professional Accountants of Canada website has affected the personal information of more than 329,000 members and stakeholders, the organization said.
The information includes names, addresses, emails and employer names, but passwords and credit card numbers were protected by encryption, CPA Canada said.
It warned the data could be used in email phishing scams and encouraged those affected to “remain vigilant.”
The attack by “unauthorized third parties” occurred between Nov. 30 and May 1, according to an internal investigation carried out with the help of cybersecurity experts.
The organization said it beefed up its security measures and contacted the Canadian Anti-Fraud Centre and privacy authorities after learning of “a possible security incident” the week of April 20.
“Upon discovering this, CPA Canada took immediate steps to secure its systems and conduct a thorough analysis to determine what information may have been involved,” the group said in an email.
“There is no evidence that the encryption keys were affected in this incident and we have no reason to believe the encryption was compromised.”
The personal information relates mainly to the distribution of CPA Magazine and everyone affected has been notified, the organization said.
Hacks against a wide range of companies since 2018 have included medical test laboratory LifeLabs and credit union Desjardins, which combined saw the theft of the personal information of more than 19 million Canadians.
This report by The Canadian Press was first published June 4, 2020.
Canada's trade deficit doubled to $3.3B in April as COVID-19 walloped imports and exports – CBC.ca
Canada’s exports and imports plunged in April on falling oil prices and as the coronavirus pandemic shut down factories and retail stores, Statistics Canada said on Thursday, adding that the reopening of most auto assembly plants may help trade in the coming months.
“We are really getting hammered with respect to cars and crude,” said Peter Hall, chief economist at Export Development Canada.
Total exports fell 29.7 per cent to $32.7 billion in April, the lowest level in more than 10 years, and imports declined 25.1 to $35.9 billion, the lowest since February 2011, Statscan said.
The April trade deficit widened to $3.25 billion from a revised $1.53 billion in March, Statscan said, larger than the $2.36 billion forecast by analysts in a Reuters poll.
Exports of energy products fell $3.6 billion, the largest decrease on record, Statscan said. Crude oil exports led the decline, plunging 55.1 per cent.
Meanwhile, exports of passenger cars and light trucks slumped 84.8, while imports plunged 90 per cent.
The slump in auto and energy exports because of shutdowns was also reflected in Canada-U.S. trade data, where total trade fell by $23.4 billion, representing more than 90 per cent of Canada’s trade activity decline. The neighbouring countries’ automotive and energy sectors are highly integrated.
The coronavirus pandemic has disrupted global supply chains and forced officials in Canada to shutter non-essential businesses and urge people to stay at home. In recent weeks, Canada’s 10 provinces have gradually begun to restart their economies.
“While some factories and retailers began to reopen in May, it’s likely to take until the June data to see any material signs of rebounding economic activity,” said Royce Mendes, a senior economist at CIBC.
“With the focus now shifting to the recovery stage, and with many economies gradually re-opening since May, the worst is hopefully in the rearview mirror,” TD Bank economist Omar Abdelrahman said.
The Canadian dollar extended its decline after the release of the data, falling to 73.88 cents US.
Canada's mortgage insurer tightens rules as it forecasts home-price drop of up to 18% – Financial Post
TORONTO — The government-backed Canada Mortgage and Housing Corp said on Thursday it would tighten rules for offering mortgage insurance from July 1, after forecasting declines of between 9 per cent and 18 per cent in home prices over the next 12 months.
The move would make it harder for riskier borrowers, who offer down payments of less than 20 per cent, to access CMHC’s default mortgage insurance.
CMHC is establishing a minimum credit score of 680 instead of the current 600, the group said in an emailed statement.
It will also limit total gross debt servicing ratios to its standard requirement of 35 per cent of annual income, compared with a threshold as high as 39 per cent currently, and total debt servicing to 42 per cent versus as much as 44 per cent now.
The measures will help curtail “excessive demand and unsustainable house price growth,” CMHC Chief Executive Evan Siddall said in the statement.
He said COVID-19 has exposed longstanding financial-market vulnerabilities, and “we must act now to protect the economic futures of Canadians.”
Some 35 per cent of Canadian banks’ mortgages are insured, their financial statements show. CMHC is the top mortgage insurer, while Genworth MI Canada and other private companies also provide similar products.
Despite evaporating activity in the housing market due to the COVID-19 pandemic, prices have continued to rise as listings have fallen off alongside demand.
Home prices across the country rose 1.3 per cent in April from March, and data from Toronto and Vancouver real estate boards showed increases of 3 per cent and 2.9 per cent in May, respectively, from a year earlier.
The CMHC has taken a more bearish view of the housing market than others. Last week, some of Canada’s biggest banks forecast maximum price declines of about 7 per cent.
Siddall last week responded to critics of its more dire outlook, saying on Twitter they were “whistling past the graveyard and offering no analysis.”
© Thomson Reuters 2020
TFC's Michael Bradley says Trump doesn't have 'a moral bone in his body' – CBC.ca
Reminder: You Can Download A Free Version Of Clubhouse Games: 51 Worldwide Classics – Nintendo Life
BoC eyeing supply, consumer demand for July economic outlook, deputy says – BNNBloomberg.ca
- Sports9 hours ago
NBA Board of Governors approves competitive format to restart 2019-20 season with 22 teams returning to play – NBA CA
- Economy19 hours ago
Higgs calls for 'cultural shift' to turn N.B.'s economic fortunes around – CBC.ca
- Science21 hours ago
The June 2020 Night Sky – Portugal Resident
- News23 hours ago
These Canadian species are found nowhere else on Earth – CBC.ca
- Media17 hours ago
Police Chief responds to controversy over social media posts – Quinte News
- Economy20 hours ago
This Is the Strangest Economy Ever – The Atlantic
- Tech18 hours ago
Apple tracks looters who steal iPhones – BBC News
- Health21 hours ago
COVID claims 23rd Langley Lodge patient, making it the deadliest outbreak in BC – Chilliwack Progress