Manulife Appoints Senior Executives in Hong Kong

Hong Kong — Manulife has announced the appointment of three senior executives in Hong Kong.

Ivan Chan, in his new role as Assistant Vice-President, Business Development, Individual Financial Products for Manulife Hong Kong, has a prime focus of expanding the company’s individual insurance business in Hong Kong, and marketing its wide range of insurance products through agency and other distribution channels.

Mr. Chan was most recently Assistant Vice-President, Field Management with Manulife Hong Kong, responsible for managing the sales and recruitment of its agency force and developing strategic directions for the team. Prior to that, he was transferred to Manulife Insurance Berhad, Malaysia as Chief Agency Development Officer in 2011, responsible for agency development, product development and related marketing functions. He joined Manulife in 1999 as a management trainee and took up several roles in individual product marketing and agency operations in both Hong Kong and Macau. He holds a Master in Business Administration from the Chinese University of Hong Kong and is a Fellow of the Life Management Institute.

Kenneth Luk has been appointed as Assistant Vice-President, Marketing and Customer Service for Manulife Hong Kong, responsible for formulating strategies and strengthening communications for customer-centric marketing programmes in relation to customer marketing, digital marketing and customer call centres, with a view to further enhancing customer experiences.

Mr. Luk has extensive experience in consumer banking, primarily in the areas of segment marketing and e-business. Before joining Manulife, he worked in several major banks with responsibilities spanning from customer touchpoint management to consumer marketing. He holds a Master’s degree in Business Administration and a Bachelor’s degree in Social Science, both from the Chinese University of Hong Kong.

Martin Lau, in the newly created role as Assistant Vice-President, Greater China Development at Manulife Asia, is based in Hong Kong, responsible for supporting the company’s strategic initiatives for its Hong Kong, Mainland China and Taiwan business units, and closely monitoring emerging business opportunities in the region.

Since joining in 2007, Mr. Lau has served in various roles and business units within Manulife, including Investments, Corporate, Asia Division Regional Office, and Manulife-Sinochem Life. His most recent position was Assistant Vice-President, Asia Corporate Development, where he worked on a number of inorganic growth opportunities. He holds a Master in Business Administration and a Bachelor in Engineering Science, both from the University of Toronto.

Photos:

Ivan Chan

Ivan Chan
Assistant Vice-President
Business Development, Individual Financial Products
Manulife (International) Limited

Kenneth Luk

Kenneth Luk

Assistant Vice-President
Marketing and Customer Service
Manulife (International) Limited

Martin Lau

Martin Lau

Assistant Vice-President
Greater China Development
Manulife Financial Asia Limited

About Manulife (International) Limited

Manulife (International) Limited is a member of the Manulife Financial group of companies.

Manulife Financial is a leading Canada-based financial services group with principal operations in Asia, Canada and the United States. Clients look to Manulife for strong, reliable, trustworthy and forward-thinking solutions for their most significant financial decisions. Our international network of employees, agents and distribution partners offers financial protection and wealth management products and services to millions of clients. We also provide asset management services to institutional customers. Funds under management by Manulife Financial and its subsidiaries were approximately C$599 billion (HK$4,367 billion) as at December 31, 2013. The Company operates as Manulife Financial in Canada and Asia and primarily as John Hancock in the United States.

Manulife Financial Corporation trades as ‘MFC’ on the TSX, NYSE and PSE, and under ‘945’ on the SEHK. Manulife Financial can be found on the Internet at manulife.com.

About Manulife Financial Asia Limited
Manulife Financial Asia Limited is one of the three constituent divisions of Manulife Financial Corporation.

Manulife Financial is a leading Canada-based financial services group with principal operations in Asia, Canada and the United States. Clients look to Manulife for strong, reliable, trustworthy and forward-thinking solutions for their most significant financial decisions. Our international network of employees, agents and distribution partners offers financial protection and wealth management products and services to millions of clients. We also provide asset management services to institutional customers. Funds under management by Manulife Financial and its subsidiaries were approximately C$599 billion (HK$4,367 billion) as at December 31, 2013. The Company operates as Manulife Financial in Canada and Asia and primarily as John Hancock in the United States.

Manulife Financial Corporation trades as ‘MFC’ on the TSX, NYSE and PSE, and under ‘945’ on the SEHK. Manulife Financial can be found on the Internet at manulife.com.

Media Contact:
Jacqueline Kam / Irina Kwan
Manulife (International) Limited

Manulife Launches Micro-films to Promote Early Retirement Planning in Hong Kong

Hong Kong — Manulife has launched micro-films entitled “80.80 Seeing the World” on its retirement campaign website. By featuring conversations about life goals and plans between the post-80s generation and people heading towards their eighties, the company aims for the micro-films to help young people understand the importance of early retirement planning.

Last year, Manulife rolled out the “RetireSimple” advertising campaign, which aimed to draw public attention to the cost-realities of retirement. The campaign’s interactive website – www.retiresimple.hk – has clocked more than 150,000 visits so far. Building on the campaign’s momentum, the new micro-films are targeted specifically to young people.

“Our customer research shows that some people start to plan for their retirement a few years after they join the workforce. We hope that the ‘80.80 Seeing the World’ micro-film series can strike an emotional chord with these young people, triggering more of them to think about and take actions for future planning,” said Isabella Lau, Vice President and Chief Customer Officer for Manulife Hong Kong.

Available on the campaign website and YouTube, two micro-films have been released. The first features local music artist Eman Lam and professional musician, Nancy Loo, who exchange stories about how they have tried to fulfil their ambitions and prepare for the future.

The second features conversations between two vocal talents — a young disc jockey, Jane Li, and a professional voice-over actor, Lam Pou Chuen, who has been the voice of the popular Japanese cartoon character Doraemon for several decades.

In addition to the micro-films, the campaign website also has regularly updated, independently authored articles on disparate retirement-related issues under its “Are you Prepared” section. Tailored to help people understand the varied requirements of adequate retirement planning, the articles cover topics such as getting the right protection, the hidden costs of falling ill later in life, and the most common mistakes people make when planning for their future.

Entitled “80.80 Seeing the World”, the micro-films feature local music artist Eman Lam (top right), professional musician Nancy Loo (top left), a young disc jockey, Jane Li (bottom left), and a professional voice actor, Lam Pou Chuen (bottom right), talking about their life goals and plans. The micro-films aim to advocate the importance of early retirement planning.

Media Contact:

Jacqueline Kam / Crystal Tse
Manulife (International) Limited

Manulife Financial Corporation dividends for December 19, 2013

TORONTO – Manulife Financial Corporation’s Board of Directors today announced a quarterly shareholders’ dividend of $0.13 per share on the common shares of Manulife Financial Corporation (the “Company”), payable on and after December 19, 2013 to shareholders of record at the close of business on November 19, 2013.

The Board also declared dividends on the following non-cumulative preferred shares, payable on or after December 19, 2013 to shareholders of record at the close of business on November 19, 2013.

• Class A Shares Series 1 – $0.25625 per share
• Class A Shares Series 2 – $0.29063 per share
• Class A Shares Series 3 – $0.28125 per share
• Class A Shares Series 4 – $0.4125 per share
• Class 1 Shares Series 1 – $0.35 per share
• Class 1 Shares Series 3 – $0.2625 per share
• Class 1 Shares Series 5 – $0.275 per share
• Class 1 Shares Series 7 – $0.2875 per share
• Class 1 Shares Series 9 – $0.275 per share
• Class 1 Shares Series 11 – $0.25 per share
• Class 1 Shares Series 13 – $0.2375 per share

In respect of the Company’s December 19, 2013 common share dividend payment date, the Board has decided that the Company will issue common shares in connection with the reinvestment of dividends and optional cash purchases pursuant to the Company’s Canadian Dividend Reinvestment and Share Purchase Plan and its U.S. Dividend Reinvestment and Share Purchase Plan. The price of common shares purchased with reinvested dividends will be reduced by a two (2%) per cent discount from the market price, as determined pursuant to the applicable plan.

About Manulife Financial
Manulife Financial is a leading Canada-based financial services group with principal operations in Asia, Canada and the United States. Clients look to Manulife for strong, reliable, trustworthy and forward-thinking solutions for their most significant financial decisions. Our international network of employees, agents and distribution partners offers financial protection and wealth management products and services to millions of clients. We also provide asset management services to institutional customers. Funds under management by Manulife Financial and its subsidiaries were C$574.6 billion (US$558.7 billion) as at September 30, 2013. The Company operates as Manulife Financial in Canada and Asia and primarily as John Hancock in the United States.

Manulife Financial Corporation trades as ‘MFC’ on the TSX, NYSE and PSE, and under ‘945’ on the SEHK.

Media inquiries: Sean B. Pasternak
Investor Relations: Steven Moore

Manulife Sponsors Breast-Cancer Awareness in Hong Kong

Manulife proud to be pink to boost breast-cancer awareness

Hong Kong — Once again, Manulife showed its solid support for the Hong Kong Cancer Fund’s awareness-raising “Dress Pink Day”, with many of its employees turning up to work in something pink — either a complete clothing item or an accessory — and making a donation to the charity.

“At Manulife, we encourage everyone to join us in being proud to be pink and wave the flag for breast-cancer awareness every October. This is a cause that has touched many of us one way or another and we are all committed to giving something back and supporting the free breast-cancer services that will continue to change lives now and in the future,” remarked Helena Lee, Assistant Vice President, Corporate Communications, Manulife (International) Limited.

She went on to say: “We pride ourselves on having been officially designated a ‘Caring Company’ title from the Hong Kong Council of Social Service since 2002; it recognizes the caring spirit that comes so naturally to all who work here.”

Manulife has been an active supporter of the Hong Kong Cancer Fund for 16 years and has backed the “Pink Revolution” since 2008. The idea behind it is that wearing something in such a striking colour will be a conversation-starter that will lead people to talk about the disease, and show how determined the campaign’s supporters are to the fight against it.

Founded in 1987, the Hong Kong Cancer Fund is one of Hong Kong’s leading cancer-care organizations. The “Pink Revolution” is its annual breast-cancer awareness and fund-raising campaign to promote the importance of early detection and raise money towards its free breast-cancer support services.

About Manulife (International) Limited
Manulife (International) Limited is a member of the Manulife Financial group of companies.

Manulife Financial is a leading Canada-based financial services group with principal operations in Asia, Canada and the United States. Clients look to Manulife for strong, reliable, trustworthy and forward-thinking solutions for their most significant financial decisions. Our international network of employees, agents and distribution partners offers financial protection and wealth management products and services to millions of clients. We also provide asset management services to institutional customers. Funds under management by Manulife Financial and its subsidiaries were C$567 billion (HK$4,183 billion) as at June 30, 2013. The Company operates as Manulife Financial in Canada and Asia and primarily as John Hancock in the United States.

Manulife Financial Corporation trades as ‘MFC’ on the TSX, NYSE and PSE, and under ‘945’ on the SEHK. Manulife Financial can be found on the Internet at manulife.com.

Media Contact:
Jacqueline Kam / Irina Kwan
Manulife (International) Limited
Tel: (852) 2202 1284 / 2510 5760
Fax: (852) 2234 6875

Manulife Japan New Executive Appointments

Manulife Japan Announces Appointment of New Executive

Tokyo – Manulife Life Insurance Company (“Manulife Japan”; President & CEO: Gavin Robinson) announced the appointment of Sumiko Asai as Vice President, Corporate Officer and Chief Marketing Officer (“CMO”) effective November 11, 2013.

Ms. Asai has more than fifteen years of extensive experience in marketing and communications accumulated through assuming various roles in the area at both domestic and foreign companies including PCA Life Insurance Company and J. Walter Thompson Japan. Asai-san joins Manulife Japan from Zurich Insurance Company (Tokyo) where she headed the public relations area. As the head of the Branding, Marketing & Communications team of Manulife Japan, she will focus on enhancing the efficiency and effectiveness of its function to support the business of the company.

As of November 11, 2013

New Title Name
Vice President, Corporate Officer and Chief Marketing Officer (“CMO”) Sumiko Asai

About Manulife
Manulife Life Insurance Company (“Manulife Japan”) is a member of the Manulife Financial Group.

Manulife Financial is a leading Canada-based financial services group with principal operations in Asia, Canada and the United States. Clients look to Manulife for strong, reliable, trustworthy and forward-thinking solutions for their most significant financial decisions. Our international network of employees, agents and distribution partners offers financial protection and wealth management products and services to millions of clients. We also provide asset management services to institutional customers. Funds under management by Manulife Financial and its subsidiaries were C$567 billion (US$539 billion) as at June 30, 2013. The Company operates as Manulife Financial in Canada and Asia and primarily as John Hancock in the United States.

Manulife Financial Corporation trades as ‘MFC’ on the TSX, NYSE and PSE, and under ‘945’ on the SEHK. Manulife Financial can be found on the Internet at manulife.com. Manulife Japan can be found on the Internet atwww.manulife.co.jp.

Media Contact
Saeko Yoshioka
Communications Department
Manulife Life Insurance Company (www.manulife.co.jp)
Tel: 042-442-7180

Manulife to Present at Barclays Americas Select Franchise Conference 2013

Manulife Financial Senior Executive Vice President and Chief Financial Officer Steve Roder to Present at the Barclays Americas Select Franchise Conference 2013

Toronto – Steve Roder, Senior Executive Vice President and Chief Financial Officer of Manulife Financial, is scheduled to present at the Barclays Americas Select Franchise Conference 2013 in London on Tuesday, May 21, 2013 at 1:45 pm BST.

Interested parties may access the live audio webcast through manulife.com/presentations. An archived version of the replay audio will be available the day after the live event at the same location for six months.

About Manulife Financial
Manulife Financial is a leading Canada-based financial services group with principal operations in Asia, Canada and the United States. Clients look to Manulife for strong, reliable, trustworthy and forward-thinking solutions for their most significant financial decisions. Our international network of employees, agents and distribution partners offers financial protection and wealth management products and services to millions of clients. We also provide asset management services to institutional customers. Funds under management by Manulife Financial and its subsidiaries were C$555 billion (US$547 billion) as at March 31, 2013. The Company operates as Manulife Financial in Canada and Asia and primarily as John Hancock in the United States.

Manulife Financial Corporation trades as ‘MFC’ on the TSX, NYSE and PSE, and under ‘945’ on the SEHK. Manulife Financial can be found on the Internet at manulife.com.

SOURCE: Manulife Financial Corporation

For further information:
Media inquiries:
Laurie Lupton – (416) 852-7792
Sean B. Pasternak – (416) 852-2745

Investor Relations:
Steven Moore – (416) 926-6495
Anique Asher – (416) 852-9580

 

Manulife Asset Management Hires New Emerging Markets Debt Portfolio Management Team

Continues expansion of global debt and equity capabilities

Third addition of seasoned portfolio managers this year

Boston – Manulife Asset Management announced it has added a new Emerging Markets Debt portfolio management team, its third such addition of seasoned portfolio managers in as many months. Effective immediately, Roberto Sanchez-Dahl, CFA, and Paolo H. Valle have joined the firm as Managing Directors and senior portfolio managers; they will be members of Manulife Asset Management’s global fixed income team.

They will manage an emerging markets debt strategy for institutional clients and certain wealth management businesses of Manulife Financial and John Hancock, and will report to Christopher Conkey, Global Chief Investment Officer of Manulife Asset Management. The team will also support other global debt strategies investing in emerging market debt.

“We are very pleased to add portfolio managers of the caliber of Roberto and Paolo to our global fixed income team, and welcome them to Manulife Asset Management. Their well-defined investment process and disciplined approach to alpha generation in EM debt represents a strong cultural fit with our investment organization. We believe that emerging markets debt, along with other global debt and equity strategies, will continue to be key areas of interest for our clients and investors, offering diversification and potential for attractive long-term returns,” said Mr. Conkey.

Mr. Sanchez-Dahl most recently was with Federated Investment Management Company, since 2001 as an emerging markets senior portfolio manager, and as an investment analyst since 1997. He previously served as an associate in the Credit Department at Goldman Sachs in New York City, from 1994 to 1997. He began his career with Moody’s Investors Service in New York. He holds a BS in mechanical electric engineering from Universidad Nacional Autonoma de Mexico, an associate degree in corporate finance from Instituto Tecnologico Autonomo de Mexico, and an MBA from Columbia University in New York.

Mr. Valle served, since 2004, as a Vice President at Federated Investment Management and most recently was an emerging markets senior portfolio manager. Previously, he was Chief Investment Officer of Ramirez Asset Management in New York City, from 2001 to 2004. Prior to that, he was a managing partner with Valle Advisors, and a first vice president and Head of the Emerging markets and International Fixed Income group with Merrill Lynch Investment Management, both in Princeton, New Jersey. He holds an MBA from the University of Pittsburgh, and a BS in business administration from the Universidad del Pacifico in Lima, Peru.

The team’s disciplined approach has driven proven investment performance. As of March 31, 2013, eVestment ranked their emerging markets debt strategy in the top decile on a three-year basis, and top quartile on a five-year basis when evaluated in the Emerging Markets Fixed Income-Hedged universe1.

Manulife Asset Management’s new Emerging Markets Debt team is the firm’s third addition of portfolio management teams this year, helping to build out the firm’s product set and expand the depth and breadth of its global equity and fixed income teams.

1Note: Past performance is not indicative of future results.

About Manulife Asset Management
Manulife Asset Management is the global asset management arm of Manulife Financial. Manulife Asset Management provides comprehensive asset management solutions for institutional investors and investment funds in key markets around the world. Manulife Asset Management also provides investment management services to affiliates’ retail clients through product offerings of Manulife and John Hancock. This investment expertise extends across a broad range of asset classes including equity, fixed income and alternative investments such as real estate, timber, farmland, as well as asset allocation strategies.

Manulife Asset Management has offices with full investment capabilities in the United States, Canada, the United Kingdom, Japan, Hong Kong, Singapore, Taiwan, Indonesia, Thailand, Vietnam, Malaysia, and the Philippines. In addition, it has a joint venture asset management business in China, Manulife TEDA. It also has operations in Australia, New Zealand, Brazil and Uruguay. John Hancock Asset Management, Hancock Natural Resource Group and Declaration Management and Research are units of Manulife Asset Management. As at March 31, 2013, assets under management were C$252 billion. Additional information about Manulife Asset Management can be found at ManulifeAM.com.

About Manulife Financial
Manulife Financial is a leading Canada-based financial services group with principal operations in Asia, Canada and the United States. Clients look to Manulife for strong, reliable, trustworthy and forward-thinking solutions for their most significant financial decisions. Our international network of employees, agents and distribution partners offers financial protection and wealth management products and services to millions of clients. We also provide asset management services to institutional customers. Funds under management by Manulife Financial and its subsidiaries were C$555 billion (US$547 billion) as at March 31, 2013. The Company operates as Manulife Financial in Canada and Asia and primarily as John Hancock in the United States.

Manulife Financial Corporation trades as ‘MFC’ on the TSX, NYSE and PSE, and under ‘945’ on the SEHK. Manulife Financial can be found on the Internet at manulife.com.

Contact:
Beth McGoldrick
617-663-4751

Manulife Financial Makes 2012 Public Accountability Statement

2012 Statement includes increased reporting detail and year-to-year comparable data

Toronto – Manulife Financial has today released its 2012 Public Accountability Statement. The statement, which reviews Manulife’s commitment to social responsibility, environmental sustainability, excellence in business conduct and corporate governance during the previous year, is now available for download at manulife.com.

The 2012 Statement highlights the Company’s continuing efforts in Canada, Asia and the United States to build stronger communities, promote health and wellness, support educational initiatives for young people and tomorrow’s leaders, enhance environmental sustainability and harness the power of volunteering in the community.

“Our company has a long, proud tradition of giving back to the communities where our employees, agents and customers live and work,” says Donald Guloien, President and Chief Executive Officer, Manulife Financial.

New in Manulife’s 2012 Public Accountability Statement are increased details, context, and metrics  that help quantify the impacts of Manulife’s programs and initiatives, whether of an economic, social or environmental nature.

Highlights from the 2012 Statement include:

Economic Impact:
Manulife is proud of the role that it is able to play in facilitating positive economic impacts in the communities where it operates by virtue of its day-to-day operations. Above and beyond these ongoing business activities, the Company engaged in a broad range of additional initiatives in 2012 which generated positive economic benefits in Canada, Asia and in the United States.

Manulife believes in the importance of partnering with organizations which help to promote active, healthy lifestyles among its global customer base and which give back to the local community. The Company is proud of the significant economic impacts that arose through its sponsorship of events in 2012, such as the Manulife Financial LPGA Classic and the Boston Marathon.

In Vietnam, the Company continued offering micro-insurance policies, which it began offering in 2009. With premiums of roughly $1 per month, the policies help women (most of whom are farmers) who want to protect themselves and their families from the risks associated with accidents, disease and natural disasters. The introduction of micro-insurance to this region helps contribute to social welfare, eliminate poverty and create awareness of savings to area residents.

Social Impact:
As in previous years, the Company encouraged its employees in 2012 to volunteer at the local community level. Volunteerism has always been a priority at Manulife and being active participants in improving local communities is a vital part of the organization’s culture. In 2012, Manulife employees and distribution partners volunteered 380,745 hours to a wide range of charities and causes. Employee donation of time is an important contribution and a way to extend the power of our corporate donations.

“We believe every volunteer act helps contribute to better outcomes for everyone,” adds Nicole Boivin, Senior Vice President and Chief Branding & Communications Officer. “At the same time, we think it’s a forward-thinking approach toward being an engaged community partner.”

Environmental Impact:
Through its ongoing commitment to sustainable investment, demonstrated by the Company’s investments in renewable energy, forest land management and volunteer programs, Manulife is helping protect biodiversity and fragile ecosystems around the world. From recycling and conservation programs to the generation of renewable energy, the Company continued to adopt environmentally friendly practices in its global office locations and throughout its global real estate portfolio during 2012.

Manulife also continued to pursue opportunities to increase the effectiveness of its business operations, while minimizing impact on the environment.  These efforts included the use of property management technologies, the introduction of data server virtualization and initiatives to encourage the reuse and recycling of electronic waste. Data on the Company’s carbon emissions, energy and water consumption, paper use and waste diversion are presented in the 2012 Statement.

Manulife Bank:
During the course of 2012, Manulife Bank surpassed $1 billion in shareholder’s equity. As such, Manulife Bank was required to prepare its first public accountability statement for its public accountability activities in 2012, which can be found on pages 44-46 of the 2012 Statement.

The full Public Accountability Statement is available online at www.manulife.com/governance

About Manulife Financial
Manulife Financial is a leading Canada-based financial services group with principal operations in Asia, Canada and the United States. Clients look to Manulife for strong, reliable, trustworthy and forward-thinking solutions for their most significant financial decisions. Our international network of employees, agents and distribution partners offers financial protection and wealth management products and services to millions of clients. We also provide asset management services to institutional customers. Funds under management by Manulife Financial and its subsidiaries were C$555 billion (US$547 billion) as at March 31, 2013. The Company operates as Manulife Financial in Canada and Asia and primarily as John Hancock in the United States.

Manulife Financial Corporation trades as ‘MFC’ on the TSX, NYSE and PSE, and under ‘945’ on the SEHK. Manulife Financial can be found on the Internet at manulife.com.

Media inquiries:
Laurie Lupton – (416) 852-7792

Sean B. Pasternak – (416) 852-2745

Boomers risk straining finances to support boomerang kids: TD poll

TD Canada Trust partners with family relationship expert Gary Direnfeld with advice on applying tough financial love

TORONTO, May 7, 2013 /CNW/ – Many parents feel the need to give financial support to their grown children well into adulthood, from welcoming them back home after graduation day to helping them pay off their credit card. In fact, one-in-five Boomers (19%) admit they would consider putting their own security and financial future at risk to help support their adult children.

New research from TD Canada Trust shows the majority of Boomer parents have financially supported their adult children in some capacity. They have let them live at home rent free (43%), subsidized big purchases like a new car or computer (29%), contributed to monthly bills like groceries and rent (23%), and helped pay off their credit card or other debt (20%).

John Tracy, a senior vice president at TD Canada Trust, warns too much financial support – coupled with mortgage payments, retirement savings, and even elder care – could put a serious strain on Boomers’ finances.

“Today’s high youth unemployment, increasing post-secondary education costs and high property prices means many young people are more likely to rely financially on their parents well into adulthood,” said Tracy. “As a parent, it’s natural to want to help when children struggle with finances, but it’s important this support does not compromise your own financial stability and retirement savings goals.”

Family relationship expert and social worker Gary Direnfeld said a little tough love is essential to avoid a cycle of dependency and to maintain healthy family dynamics.

“Some parents worry too much about being liked by their kids, but as parents it’s our job to teach our children financial independence so they learn how to cope with frustration, overcome adversity and appreciate the value of a dollar,” Direnfeld said. “Even if money is not an issue, setting boundaries and knowing when to say ‘no’ from the time kids are young will help develop responsible young people, so we don’t end up with a generation of dependent adults.”

Additional advice from Tracy and Direnfeld on how boomer parents can practice tough love when it comes to family finances:

1. Have open and honest conversations

“Don’t assume that everyone is on the same page; be clear on what you are and are not willing to support financially,” said Tracy. For example, if grown children move back home, will they be responsible for paying rent or covering any household expenses, and what are the implications if downsizing is a future consideration?

“If the support strains your finances, share those concerns and explain the basis for your decision to cut back or say ‘no,'” Direnfeld said. “The big challenge is withstanding the initial backlash and staying firm. Depending on the circumstances, some families find it useful to seek support from a third party, like a financial advisor or social worker.”

2. Pay yourself first

Tracy says it is vital to prioritize retirement savings in peak earning years, so parents should refer to their financial plan before lending a hand to their children. “Millennials have decades left in the workforce to earn money, but Boomers likely do not,” said Tracy. “If parents can’t support themselves in retirement, then they risk shifting the financial strain onto their children instead.”

To make saving simpler, set up regular preauthorized transfers of a set amount into an RSP, and ideally, a TFSA for emergencies. Saving automatically can help parents resist the temptation to splurge on their children instead of saving for the future.”

3. Budget and plan for generosity

Fifty-four percent of parents estimate that even though their adult children are not attending school, they provide between $100 and $300 each month in financial support. The research also found 18% of parents have helped their children with the down payment on their first home. Regardless of how much support parents offer, Tracy says it’s crucial to budget for it.

“Before helping with a down payment, speak with a financial planner and mortgage expert in tandem to understand the financial implications and, more importantly, to find out if all parties can truly afford to do it,” Tracy said. “If your child has saved a sizable down payment and proven they are ready to take on the responsibility of a mortgage, topping up their down payment could save them thousands of dollars in the long run if you have the means.”

4. Be a role model and teach financial literacy

Tracy and Direnfeld agree that teaching children about money from a very young age can help prevent a cycle of dependency. But, for parents who feel the strain of supporting adult children today, they recommend firm but measured action. “Parents should gradually shift their role from financial aid to financial coach, and help their kids establish a plan to get their expenses under control and pay down debts,” said Tracy.

Direnfeld adds that grown children need to understand independence means owning their own consequences, and he says parents should let their children learn this lesson through experience rather than making a decision to support them out of guilt. “Being a role model is only as good as the example you set; let your children see that you hold them accountable for their own decisions,” said Direnfeld.

About the TD Canada Trust Tough Financial Love Poll

TD Bank Group commissioned Environics Research Group (www.environics.ca) to conduct an online custom survey of 2,155 Canadian parents who have adult children not attending school. Responses were collected between January 10 and 25, 2013.

About TD Canada Trust  

TD Canada Trust offers personal and business banking to more than 11.5 million customers. We provide a wide range of products and services from chequing and savings accounts, to credit cards, mortgages and business banking, to credit protection and travel medical insurance, as well as advice on managing everyday finances. TD Canada Trust makes banking comfortable with award-winning service and convenience through 24/7 mobile, internet, telephone and ATM banking, as well as in over 1,100 branches, with convenient hours to serve customers better. For more information, please visit: www.tdcanadatrust.com. TD Canada Trust is the Canadian retail bank of TD Bank Group, the sixth largest bank in North America.

SOURCE: TD Canada Trust

For further information:

Liz Christiansen / Jillian Turgeon
Paradigm Public Relations
416-203-2223

Sandra De Carvalho
TD Bank Group
416-944-7095

Canadians put the brakes on spending – consumer credit growing at slowest pace since the early 1990’s: CIBC

For the first time since 2002 consumer credit in Canada is rising more slowly than in the U.S.

Canadians are putting the brakes on spending with outstanding consumer credit now rising at the slowest pace since the early 1990’s, finds a new report from CIBC World Markets.

“Regardless of how you measure it, there is a clear slowing trend in the pace of growth in household credit,” says Benjamin Tal, Deputy Chief Economist at CIBC and author of the report. “The pace of growth is no longer a reason for the Bank of Canada to move from the sidelines any time soon.

“Households should get credit not only for notably slowing the pace at which they accumulate debt in an environment of historically low interest rates, but also for managing their debt in the most optimal way on record.”

The report notes that on a year-over-year basis, total household credit (consumer credit plus mortgage outstanding) is now rising by just over five per cent — the slowest pace since 2002. The key is the rapid softening in the pace of consumer credit. As of March 2012, overall consumer credit outstanding rose by only 2.3 per cent on a year-over-year basis — the slowest pace since the early 1990s. On a rolling month-over-month basis, consumer credit is now rising by only 0.1 per cent — the slowest pace since 1993.

“The slowing in consumer credit is largely due to the softening performance of the credit cards market,” adds Mr. Tal. “Overall growth in card balances is now marginally in negative territory, with both classic and premier cards showing a similar performance.

“While the dramatic softening in activity during the recession was in part due to supply factors, today’s slowing is driven more by demand considerations, as well as an active shifting of card balances to lines of credit. This trend is very visible in the most recent uptick in activity in the lines of credit portfolio, which we believe is mostly a transfer of balances from the credit card portfolio.”

For the first time since 2002 consumer credit in Canada is rising more slowly than in the U.S. During the highly leveraged period between 2002 and 2008, consumer credit inCanada rose twice as fast as it did in the U.S. After the crisis, growth in U.S. consumer credit actually moved into negative territory, while consumer credit in Canada continued to expand and with U.S. consumer credit now expanding at its pre-recession rate of 4.3 per cent year-over-year.

In addition to a slowing in the growth of consumer debt, the mortgage market is also starting to show some early signs of moderating activity. As of March 2012, mortgage outstanding rose by 6.3 per cent on a year-over-year basis — a rate that is well below the 7.3 per cent average rate of growth seen in the past two years and well below the pace seen during most of the decade.

The softening trend is much more evident in a rolling month-over-month growth rate, which at 0.5 per cent is the slowest since late 2001. The recent modest softening in mortgage activity is coinciding with a reduction in the mortgage arrears rate, which as of January 2012, stood at under 0.4 per cent after reaching close to 0.5 per cent during the recession.

This rate is still double that seen before the recession but is significantly below rates seen in previous recessions. The arrears rate in Alberta is by far the highest in the nation. This reflects the fact that, on average, homeowners in Alberta are younger and less established. As well, the pre-recession period in Alberta had seen activity surging rapidly — leading to a higher percentage of consumers overextending themselves.

“There is no debate about the fact that the housing market is overshooting,” says Mr. Tal. “The only question is what will be the nature of the adjustment. In the absence of a trigger for a violent correction, we do not see such an outcome in the near future. We continue to call for a gradual softening in the market, with prices potentially falling by around 10 per cent in the coming year or two.

“Other factors that will work to soften activity in the market are ongoing changes in the mortgage market with increased scrutiny from regulators regarding risk management practices, as well as the increased use of full-scale appraisals as part of the adjudication process. Accordingly we see mortgage market growth softening gradually to around five per cent year-over-year during the course of the year, down from the current 6.3 per cent rate.”

Interest payments on debt accounted for 7.3 per cent of disposable income in the fourth quarter of 2011, roughly the same ratio seen in the previous two quarters. This relative stability, however, masks two diverging trends; interest payments on mortgage debt is falling, whereas interest payments on consumer credit is rising. Mortgage interest payments as a share of disposable income are at the lowest point since late-2004.

After rising rapidly during the recession, the debt-to-asset ratio has stabilized at 20 per cent in the past two years. With credit softening and asset value rising in the first quarter of the year, we expect to see this ratio improving — a fact that should see the ratio of net worth to disposable income rising in the first quarter. Note that an average household inCanada currently carries a debt load of $102,000 versus an asset position of over$350,000 (of which $250,000 is real estate).

“Looking ahead, it is difficult to get too excited about the consumer’s near-term prospects,” notes Mr. Tal. “With consumer credit growth slowing to a crawl, the housing market leveling off and potentially losing some ground, Canadian consumers will lose two of the main pillars of strength that made them the champion of the recent economic cycle. And while the volatility in the job market statistics will continue to confuse observers, the trend is clear: the pace of job creation in Canada is slowing from 22,000 jobs a month in 2011 to probably around 15,000 in 2012. And the changing composition of employment is likely to work to lower the quality of employment in the country along with the bargaining power of workers — limiting gains in labour income.”

The complete CIBC World Markets report is available at:http://research.cibcwm.com/economic_public/download/hca-120509.pdf

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For further information:

Benjamin Tal, Deputy Chief Economist, 416-956-3219, benjamin.tal@cibc.ca or Kevin Dove, Head of External Communications, 416-980-8835, kevin.dove@cibc.com.