The Public Finance Committee: National Bank presents its recommendations on mutual funds
Montreal, 6 February 2007 -
At today’s Public Finance Committee hearings on mutual funds, National Bank presented several recommendations for maintaining balance between investor protection and development of the industry.
At the outset, Charles Guay, Senior Vice-President – Mutual Funds at National Bank, pointed out that investors in Quebec still have confidence in mutual funds. “In fact, their investments have increased in value by more than $30 billion over the past three years,” he stated. Mr. Guay added that the way to maintain balance between investor protection and industry development is to refrain from imposing an excessive number of regulations, which would only stifle industry development. He also stressed the need to harmonize legislative and regulatory initiatives in Quebec with those undertaken by securities regulators in the rest of Canada.
In order to adequately protect investors, National Bank believes that the Autorité des marchés financiers (AMF) should be given broader powers with regard to public enquires and criminal prosecution so that it can return misappropriated funds without having to go before the civil courts. The Bank also believes that extending the scope of the work of external auditors would provide added protection for investors. Establishing a five-year relevant experience rule for the accountant in charge of an external audit and rotating auditing firms after four or five years are other measures proposed by Mr. Guay.
Mr. Guay also recommended imposing stiffer penalties for infractions, which the AMF had called for last fall. He added that whistle blowing was not prevalent because of the lack of protection offered. “We believe that, with better support, whistle blowing would be an important safeguard against fraud.”
About National Bank of Canada
National Bank of Canada is an integrated group which provides comprehensive financial services to consumers, small and medium-sized enterprises and large corporations in its core market, while offering specialized services to its clients elsewhere in the world. The National Bank offers a full array of banking services, including retail, corporate and investment banking. It is an active player on international capital markets and, through its subsidiaries, is involved in securities brokerage, insurance and wealth management as well as mutual fund and retirement plan management. National Bank has more than $116 billion in assets and, together with its subsidiaries, employs 16,972 people. The Bank’s securities are listed on the Toronto Stock Exchange (NA:TSX). For more information, visit the Bank’s website at www.nbc.ca.
Information (The telephone number provided below is for the exclusive use of journalists and other media representative.):
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National Bank of Canada
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