Category Archives: Royal Bank of Canada

Mortgage-Free Eventually: RBC Poll Finds Majority of Canadians Hope to Pay Off Their Homes by Retirement

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Nearly three-quarters (72 per cent) of Canadians with a mortgage hope to bemortgage-free by the time they reach age 65, but one-third (33 per cent) of older Canadians, those over the age of 55, have 16 or more years left on their mortgage term, according to the latest RBC Housing Snapshot poll.

“Canadians want to be mortgage-free as they approach retirement age and beyond, but the reality is that it takes prudent planning and the right advice to stay on track,” said Claude DeMone, director of Strategy for Home Equity Financing, RBC. “Using flexible and accelerated payment options are an easy and pain-free way to help take years off your mortgage and save thousands of dollars in interest costs.”

Canadians overwhelmingly say that a low interest rate is the most important feature when choosing a mortgage (96 per cent). Almost nine-in-10 Canadians also say that accelerated payment options (85 per cent) and flexible payment options (88 per cent) are important and desirable features.

Looking ahead, the majority of Canadians expect steadyinterest rates in the next six to 12 months. Almost one-in-five Canadians (18 per cent) expect rates will rise less than one per cent. Just over a quarter of respondents (26 per cent) think interest rates will rise more than one per cent in the same time period.

“Though many Canadians expect interest rates to stay the same over the next year, they should still keep in mind that it’s important to build some wiggle room into your budget to prepare for any extra costs or future rate increases,” DeMone added.

With a firm belief that interest rates will stay relatively stable over the next year, the RBC poll shows Canadians are increasingly interested in using either a variable (29 per cent, compared to 19 per cent in the first quarter of this year) orfixed rate mortgage (46 per cent, compared to 40 per cent in the first quarter of this year). Interest in using a hybridmortgage (part fixed, part variable) has declined (25 per cent, compared to 41 per cent in the first quarter of this year).

DeMone offers the following mortgage advice that will help Canadians pay down mortgages faster and get the right one to meet their individual needs:

  1. “Stress test” your mortgage for rate increases.If you are concerned about affordability down the road, knowing what your payments would be with a one to three per cent rate increase will give you greater peace of mind that your new home is affordable both today and in a few years, when rates might be higher.
  2. Look beyond the interest rate and consider your prepayment options. Many closed mortgages allow you to double up a payment or pay a lump sum on your mortgage annually without prepayment charges. Prepayments are applied directly to the principal balance, helping to save thousands of dollars in interest costs over the life of the mortgage.
  3. Take advantage of early renewal options. Some mortgages allow you to renew up to 120 days before the end of your term. This means you can lock in your new mortgage rate early.

Poll highlights:

  • An equal amount of Canadians in the 35-54 age group plan to be mortgage-free by age 55 (39 per cent) or by age 65 (39 per cent).
  • Young Canadians (age 18-34) have the most aggressive views of when they will be mortgage-free (by age 35: 12 per cent; by age 45: 26 per cent).
  • Among Canadian homeowners, the number of mortgage-free Canadians has increased slightly to 41 per cent in the fourth quarter from 38 per cent in the first quarter, and the highest level since 2006.
  • Canadians ages 55 and over were more likely to expect interest rates to stay about the same in the next six to 12 months (55+ 60 per cent compared to the national average of 51 per cent).

One-third of younger Canadians (18-34: 34 per cent) anticipate a steeper increase in interest rates in the next six to 12 months.

Regional highlights for British Columbia, Alberta, Prairies,Ontario, Quebec, and Atlantic Canada are also available.

Canadians can visit the RBC Advice Centrewww.rbcadvicecentre.com for advice on the costs associated with purchasing a home. The RBC Advice Centre is an online resource, with videos and interactive tools and calculators, that gives Canadians access to advice about all aspects of their finances including their homeownership goals – whether they are buying their first home, planning their next move, renovating or managing their current home financing. With the guidance of RBC mortgage specialists, Canadians have access to free, no-obligation professional advice and personalized one-on-one service about RBC mortgage products and services.

RBC is the largest residential mortgage lender in Canada. As the country’s number one source of financial advice on homeownership, RBC conducts consumer surveys as one way to provide insight to Canadians about the marketplace in which they live. These are some of the findings of the RBC Housing Snapshot poll conducted by Ipsos Reid between from October 6-14, 2011. The results are based on a sample where quota sampling and weighting are employed to balance demographics and ensure that the sample’s composition reflects that of the actual Canadian population according to Census data. Quota samples with weighting from the Ipsos online panel provide results that are intended to approximate a probability sample. An unweighted probability sample of 2,282 adults, with 100 per cent response rate, would have an estimated margin of error of ±2 percentage points, 19 times out of 20. The margin of error within subgroups of the sample will be higher.

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For more information, contact:
Ka Yan Ng, RBC Communications
Matt Gierasimczuk, RBC Communications

RBC Donates $2.6 Million to 99 After-School Programs Across Canada

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The RBC After-School Grants Project announced on November 17, 2011 that 99 community-based organizations across Canada will share $2.6 million in funding to provide after-school programs, including 15 new grant recipients. RBC has been supporting after-school programs since 1999, helping provide children with a safe, supervised environment for activities outside the classroom.

“Having funded 227 after-school programs since 1999, we know that children who participate in these programs have enhanced social skills and show increased motivation to excel in school,” said Shari Austin, vice-president, Corporate Citizenship at RBC. “We are very proud that our grants continue to help community-based organizations provide engaging activities that keep kids safe, inspire them to learn and grow, while alleviating some pressures for working families.”

RBC After-School Grant recipients represent a diverse range of community based organizations, and were chosen by members of the community. Each program will receive up to $40,000 from RBC. There are 15 first-time grant recipients, including:

BRITISH COLUMBIA

  • Chilliwack Central Elementary School – A grant of $40,000 will help this downtown school provide a free after-school program to about 50 children, five days a week. Children can get help with homework, enjoy daily story time, visit the local library, participate in a formal fitness program, and receive art instruction.
  • KB Woodward Elementary School – A grant of $40,000 will help this school, located in Surrey where half of the residents are newcomers to Canada, provide a free, daily program for 30 children aged 6-12. Many other community partners are engaged to help deliver tutoring, ESL and literacy, athletics, arts and music programs, computer workshops and a science program.

ALBERTA

  • The Airdrie Boys’ and Girls’ Club – A grant of $40,000 will help this organization start a new, daily after-school program for about 30 teens, aged 13-18. This program addresses a need for local children to have access to organized activities and homework help and will provide group and individual life skill development, a book club, and weekly volunteering opportunities.
  • The Cerebral Palsy Association – A grant of $40,000 will help this organization start a new after-school program for teens with disabilities. The funds will be used to purchase specialized equipment, develop programming and educational resources. Activities will include homework help, art, mentoring, healthy snacks, computers, music therapy, cultural trips and sports.

SASKATCHEWAN

  • YMCA King George Community School – A grant of $34,000 will help provide a daily after-school program for 35 First Nations children aged 6-12, with culturally-sensitive activities as well as swimming lessons, tours, and activities at the YMCA.
  • Boys and Girls Clubs of Regina – A grant of $40,000 will help the Boys and Girls Club deliver free programming for 20 children, aged 7 to 14, in Regina’s inner-city, where youth face issues such as malnutrition, gangs, substance abuse and lack of access to social supports. Activities will focus on skill development and artistic expression in a safe environment.

MANITOBA

  • Boys and Girls Clubs of Winnipeg, Aberdeen Club– A grant of $40,000 will help this organization deliver a free, daily after-school program to about 25 children aged 6-14, many of whom are Aboriginal. Activities will include organized sports, art and performing arts, homework help, computer instruction and environmental programs.

ONTARIO

  • The Beyond 3:30 program/ Kane Middle School, Toronto – A grant of $40,000 will allow this organization, serving a neighbourhood where drop-out rates are increasing, to provide a free, daily after-school program to more than 40 children aged 11-14. The program will offer homework help, a Book Club, a Junior Chefs Club, sports, music activities, as well as provide a nutritious snack, and discussions about topics ranging from gardening to bullying.
  • Harmony for Youth, Sarnia – A grant of $40,000 will help this organization run an after-school program in a region where children often lack the resources and supports they need just to complete their homework. The free daily program will be open to 25 participants aged 4-18, and will provide tutoring, cultural activities, such as music, crafts, cooking, leadership skills, mentoring, nutritious snacks, computer support, and outdoor activities, ‘pay it forward’, and a bully-buster program.
  • Essa Public Library After School Program – A grant of $39,400 provides a daily after-school program for 40 children aged 8-13, including children from military families stationed at CFB Borden, who face additional challenges because of frequent moves from school to school. The program will provide daily homework help through peer-tutoring, physical activities and games, art and crafts, special guests, music and a nutritious snack.
  • Wasauksing First Nation – A grant of $40,000 will help this community provide a daily after-school program to 25 students aged 12-18. The program is intended to help students transition from a small elementary school to the nearby high school through activities that help build self-esteem in a safe environment. RBC’s funds will be used to provide activities requested by the youth themselves, including sports, homework help, hand drumming and dancing, leadership opportunities through Drum Chiefs and Drum Kwee, access to a computer lab and nutritious snacks.

QUEBEC

  • Projet Harmonie, Montreal – A grant of $40,000 will help this organization provide a free, daily after-school program for 30 children aged 6-12. Children benefit from a range of activities including homework help, reading exercises, sports, music and even food-shopping expeditions to learn about the importance of good nutrition.
  • Centre communautaire Hochelaga, Montreal – A grant of $35,000 will help provide a daily after-school program for 25 participants aged 6 to 12. Children will get homework help and access to computers in a safe environment. The program also engages youth and seniors from the community so that participants can benefit from intergenerational connections.

ATLANTIC

  • Lower Sackville Boys and Girls Club, Nova Scotia– A grant of $35,000 will help provide a daily after-school program for 80 children aged 5-16. The funding will be used to add a new athletic program and math tutoring, to the current range of activities such as homework help, a reading club, swimming, arts and cultural activities, computer instruction and a science club.
  • Jello Tree After School Program, Shelburne County Youth Health and Support Association, Nova Scotia – A grant of $40,000 will help provide a free, daily after-school program for 30-35 participants aged 5 to 16. Activities include daily homework help, organized sports, art, leadership training, guitar, voice and song writing, as well as supervised time on computers, discussion groups/workshops by staff on topics ranging from addictions to healthy lifestyle choices, nutrition and bullying.

To be selected for a grant, after-school programs must offer structured and supervised activities for children between the ages of six and 17. The programs must focus on what RBC calls the “three Ss” — safety, social skills and self-esteem. RBC’s grants are used to provide a wide-range of activities including computer instruction, sports, literacy tutoring, music and art lessons, nutrition guidance, and homework help.

Since 1999, RBC has provided more than $25 million in grants to 227 after-school programs in Canada, helping more than 24,000 children.

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For more information, please contact:
Jackie Braden, RBC Brand Communications, (416) 974-1724

RBC Dominion Securities to Receive Transfer of MF Global Canada Inc. Client Accounts

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On November 14, 2011 RBC Dominion Securities announced it had agreed to the transfer of client accounts from MF Global Canada Inc., whose parent company, MF Global Holdings Ltd. filed for Chapter 11 bankruptcy on October 31, 2011.

On November 14, 2011, the Ontario Superior Court of Justice approved the transfer of certain MF Global Canada client accounts to RBC Dominion Securities. Holdings in the accounts to be transferred include futures, equity and fixed income positions. This transfer will enable these account holders to access their accounts.

KPMG, the Court-appointed trustee in bankruptcy, and the Canadian Investor Protection Fund (CIPF) approached RBC Dominion Securities after the bankruptcy filing to request accommodating a bulk transfer of accounts and positions. RBC was approached given its strong balance sheet and commitment to the futures business.

“We have been working diligently with KPMG to secure the required approvals and resolve the matter for MF Global Canada clients,” said David Agnew, Head, RBC Wealth Management Canada. “We realize that the past two weeks have been very stressful for MF Global Canada clients. RBC Dominion Securities is happy to be in a position to assist.”

On Tuesday November 15, RBC Dominion Securities will begin proactively contacting clients of MF Global Canada and working with them to expedite access to their accounts.

RBC Dominion Securities has a robust infrastructure that can accommodate trading and hedging solutions across major markets for futures, options and commodities, including its own clearing capability for futures and options trading. This is in addition to disciplined investment management expertise in equities, fixed income and foreign exchange, as well as a comprehensive range of estate and wealth planning solutions.

Further information about the bankruptcy of MF Global Canada is available on the KPMG website kpmg.ca/mfglobalcanada, by e-mail mfglobalcanada@kpmg.ca, or by phone (416 777 3666 or toll-free at 1 866 602 6743).

About RBC Dominion Securities
With over 400,000 clients across Canada and worldwide, and $180 billion in assets under administration, RBC Dominion Securities is Canada’s leading full-service investment and wealth management firm for affluent and high net worth investors. While investment management is the core offering, our 1,500 investment advisors and portfolio managers also provide a full range of wealth management advice and solutions, such as insurance, retirement, estate and tax planning and charitable giving to help our clients preserve, grow and pass on their wealth. www.rbcds.com

For more information, contact:
Bev MacLean, Corporate Communications, RBC,  416-974-9334

Canadians are in a Gift-Giving Mood for the Season According to RBC Survey

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TORONTO, November 22, 2011— With the holiday season just 32 shopping days away, there may be a few more presents under the tree this year. According to an RBC survey, Canadian gift-givers are planning to spend an average of $640 on gifts – up from $624 last year – and on average they will be spending $100 more than last year ($612 compared to $512) on other holiday items (entertainment, decorations, travel, etc.)

If last year’s spending intentions and actual expenditures are any indication, Canadians will be experiencing yet another post-holiday headache, trying to pay off their bills in the New Year. In 2010, one-third of holiday shoppers who went over budget spent an average of $429 more than they intended – Atlantic Canadians actually overspent by $521, the highest expenditure in the country – and ended up cutting back on entertainment, day-to-day living expenses, credit card use and coffee/lunch costs to make up the difference.

“Having a budget in mind before you start checking off your holiday gift list will help ensure you’re only spending what you know you can afford. It can be easy to get carried away with the holiday spirit when you’re out shopping,” advised Maria Contreras, product manager, Savings Accounts, RBC. “The very best gift you can give to yourself and your family is a debt-free holiday season – and a financially worry-free New Year.”

Many Canadians intend to use money in hand to do their gift-buying, including cash (55 per cent) and debit cards (27 per cent) among their top three financing options for holiday purchases. Credit cards (37 per cent) round out the top three. Another sign that consumers are budget-minded: only 10 per cent said they hadn’t yet thought about how to finance their holiday spending, compared to 20 per cent in 2010.

“Enjoying the holidays doesn’t have to come with a big price tag attached,” added Contreras. “A little planning ahead can help you stay within your spending limits for the holidays, as well as all year round. Ideally, you’ll not only be covering your expenses, you’ll also be saving money for your future goals. You can also use online financial management tools such as myFinanceTracker, a great solution for setting and tracking budgets, savings goals and spending habits.”

Six Savings Tips for the Holidays and Year-Round

  1. Curb your impulses. Count to 30 before impulse buying in a store, or wait 24 hours before making an online shopping decision.
  2. Pay yourself first. Make your savings plan part of your bill paying routine, just like cable, utilities and mortgage payments.
  3. Track your expenses. Make a list of all your expenditures over three months to see where there are opportunities to turn spending into saving.
  4. Keep a separate savings account. Set up an account dedicated to savings; in this way, your savings won’t get mixed in with your day-to-day cash.
  5. Set a target date for your savings goal. Having a deadline can help you decide how much to put away and how often.
  6. Visualize your savings goal. Are you saving for a vacation? A big screen TV? Keep a photo of your dream on hand, to inspire you to continue saving.

About the RBC survey

As part of Canada’s most comprehensive consumer attitudes poll, this survey was conducted online via Ipsos Reid’s national I-Say Consumer Panel to 3,054 Canadians (453 British Columbia, 454 Alberta, 458 Saskatchewan/Manitoba, 705 Ontario, 516 Quebec, 467 Atlantic Canada). Weighting was then employed to balance demographics and ensure that the sample’s composition reflects that of the adult population according to Census data and to provide results intended to approximate the sample universe. Data collection was September 26 to October 03, 2011. A survey with an unweighted probability sample of this size and a 100 per cent response rate would have an estimated margin of error of ±1.65 percentage points, 19 times out of 20, of what the results would have been had the entire population of adults in Canada been polled.

For more information, contact:
Kathy Bevan, RBC Corporate Communications, 416 974-2727
Craig Christie, RBC Corporate Communications, 416 974-8820

High Net Worth Canadians Concerned with Death, Taxes and Retirement According to RBC Wealth Management Survey

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TORONTO, October 17, 2011 — The transfer of wealth at death, minimization of taxes, and financial needs during retirement were identified as the top three concerns of high net worth clients in a survey by RBC Wealth Management.

The survey was conducted by RBC Wealth Management as part of one-on-one planning sessions with clients. In the past year, approximately 2,500 sessions were conducted across Canada and these concerns were identified as the most pressing for high net worth clients.

“Our clients are very concerned about estate planning. What happens to their wealth during retirement and after they are gone are their main priorities,” said Howard Kabot, vice-president, Financial Planning, RBC Wealth Management Services. “Clients tell us that they want to make sure their families are appropriately taken care of and that their financial plan is as efficient, effective and prudent as possible.”

Other issues identified in the survey as important to RBC Wealth Management clients include planning for disability, tax minimization and philanthropy. As a comparison, Canadians as a whole are interested in reducing what they owe (32 per cent), followed by spending less (28 per cent) and saving or investing more (24 per cent). (RBC Canadian Consumer Outlook, July 2011).

RBC Wealth Management is the only wealth management provider in Canada to offer an in-house highly-specialized team of professionals that works with advisors and private bankers to offer all-encompassing financial advice. The in-house unit, RBC Wealth Management Services, provides clients with exclusive access to over 150 financial planners, tax specialists, accountants, high net worth specialists, lawyers, will and estate planners, insurance specialists and other professionals to maximize the effectiveness of their financial plan.

“RBC Wealth Management is 100 per cent unique in its offerings,” said Anthony Maiorino, vice-president and head, RBC Wealth Management Services. “No other wealth management firm can provide such a complete, end-to-end level of highly specialized service to clients.”

About RBC Wealth Management
RBC Wealth Management is one of the world’s top 10 largest wealth managers. RBC Wealth Management directly serves affluent, high-net-worth and ultra high net worth clients in Canada, the United States, Latin America, Europe, the Middle East, Africa and Asia with a full suite of banking, investment, trust and other wealth management solutions. The business also provides asset management products and services directly and through RBC and third-party distributors to institutional and individual clients, through its RBC Global Asset Management business (which includes BlueBay Asset Management). RBC Wealth Management has more than C$525 billion of assets under administration, more than C$310 billion of assets under management and approximately 4,500 financial consultants, advisors, private bankers and trust officers.

For more information, please contact:
Bev MacLean, RBC Wealth Management Communications,
(416) 974-9334

Secrets to Small Business Success as Revealed by Entrepreneurs in RBC Poll

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TORONTO, October 13, 2011 — Canadian entrepreneurs say the most important pieces of advice that they would give to other entrepreneurs to help them grow their businesses are: 1) develop an effective business plan (44 per cent); 2) manage your time well (43 per cent); and 3) engage in networking (38 per cent), according to the 2011 RBC Small Business Survey conducted by RBC and Ipsos Reid.

“With many competing priorities, it can be challenging for any small business owner to know where to focus their attention,” said Mike Michell, national director, Small Business, RBC. “These survey results tell us loud and clear that planning, networking, and managing your time should be at the top of every entrepreneur’s agenda.”

Entrepreneurs suggest that other business owners who want to grow their businesses should also:

  • Seek help/advice (28 per cent);
  • Aggressively solicit clients/business (25 per cent);
  • Conduct market research/planning (25 per cent); and
  • Get financial advice before starting our business (23 per cent).

“This is great advice coming from small business owners considering the challenges that they expect to face over the next year,” said Michell. “The expertise of peers and professionals can help take your business to the next level.”

The study also found that the top three challenges business owners say that they will face over the next year are:

  • finding clients/developing market (60 per cent);
  • maintaining sufficient cash flow/maintaining growth (47 per cent); and
  • work life balance issues, like working long hours (35 per cent).

“Lessons can be learned from these challenges,” adds Michell. “Finding clients, as well as retaining them, is an ongoing challenge for business owners at every stage, and critical to the life and success of any business.”

RBC Business Success Tips

  • The creation of a business plan should help you identify your customers, your market, the competitive landscape, and other important aspects of your business.
  • Leverage your business plan to help identify what your true priorities are, and start each day with a plan to effectively manage your time.
  • Ask for advice from people who are already working in your line of business, as many of them are usually willing to share industry information or serve as sounding boards for your ideas.
  • Leverage technology to communicate to potential and existing clients, using websites and social media.

These are some of the findings of an RBC/Ipsos Reid survey conducted from July 29 to August 8. This online survey of 1,400 entrepreneurs, who were either self-employed or owned their own small business, was conducted via the Ipsos I-Say Online Panel, Ipsos Reid’s national online panel. The results are based on a sample where quota sampling and weighting are employed to balance demographics and ensure that the sample’s composition reflects that of the actual Canadian population according to Census data. Quota samples with weighting from the Ipsos online panel provide results that are intended to approximate a probability sample. An unweighted, probability sample of this size, with 100 per cent response rate would have an estimated margin of error of ±3 per cent, 19 times out of 20.

About RBC Small Business Banking

Small businesses in Canada want flexible banking choices, convenient payment options and simple ways to manage their cash flow. Whether they are starting a business, managing growth, or succession planning, the RBC Advice Centre can help answer their questions. Free interactive tools and calculators provide customized information covering many facets of business finance and online advice videos are updated regularly to answer questions that are top of mind with small business owners. With the guidance of RBC business advisors, small business owners have access to free, no obligation professional advice about RBC products and services. For more assistance, please visitwww.rbcadvicecentre.com.

For more information, please contact:
Margie McNeil, RBC Corporate Communications, 905 606-1425, margie.mcneil@rbc.com
Angela Gordon, RBC Corporate Communications, 905 816-5650, angela.gordon@rbc.com

Call for Applications for the RBC After-School Grants Project

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Deadline to apply is March 4, 2011

TORONTO, January 24, 2011— RBC today announced its call for grant applications for the 2011-2012 school year as the RBC After-School Grants Project is offering more than $2 million in grants to fund first-time and renewed grant recipients.

The grants are awarded by regional community panels made up of experts in the fields of youth and education. Each organization should have a mandate to keep students in grades K-12 safe as well as positively engaged through an enriched curriculum after their classes end each day. RBC After-School grants of up to $40,000 are provided by the RBC Foundation to programs in at-risk or underserved communities. The deadline for funding applications is March 4, 2011, and grant recipients will be advised by June 2011.

“Research has shown that participation in after-school programs helps students enhance their academic performance, improve social skills and motivate them to excel in school,” said Shari Austin, executive director, RBC Foundation. “We are looking to fund the best after school programs in the country that help bridge the gap between schoolwork and homework and offer students an opportunity to participate in a wide-range of other activities that help build self-esteem and confidence.”

To qualify for a grant, after-school programs should offer structured, supervised activities five days a week and focus on offering a variety of activities, such as, computer instruction, sports, literacy tutoring, music and art lessons, nutrition guidance, and help with homework.

RBC has been funding after-school programs since 1999, with over $22 million through 750 grants to 212 different organizations that have helped more than 24,000 children. RBC After-School Grant applications can be downloaded from www.rbc.com/afterschool.

Charities wishing information about RBC’s After-School Grants program may contact Frances Bedford-Jones at
(416) 974-2176, frances.bedford-jones@rbc.com.

The young and the RRSP-less – Fewer young Canadians saving for retirement: RBC Poll

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 TORONTO, January 19, 2011 — The number of Canadians aged 18 to 34 who have RRSPs has dropped to 39 per cent – the lowest level in almost a decade – and fully 45 per cent have not started saving for retirement yet, according to the 21st Annual RBC RRSP Poll.

Overall, retirement savings ranked seventh as a financial priority among younger Canadians (26 per cent). The RBC poll found that this age group is more focused on other financial goals such as regular payments to reduce or eliminate debt (56 per cent), saving for a rainy day (45 per cent) and homeownership (44 per cent).

The declining number of younger Canadians with RRSPs confirms a downward trend identified in last year’s RBC RRSP Poll and discussed in an RBC Economics report issued in January 2010.

“We’re seeing other financial priorities become increasingly top of mind for younger Canadians who may not realize they are missing out on one of Canada’s best income tax savings vehicles, as well as the potential to grow their investments more quickly,” said Lee Anne Davies, head, Retirement Strategy, RBC. “Retirement may seem far off in the future and we understand that paying off debt, purchasing your first home or raising young families presents competing financial needs, but building a secure future can and should be part of any plan to meet those needs.”

The RBC poll also found that, despite ranking homeownership as third on their financial priorities list, younger Canadians may be under-utilizing the RRSP benefits available to first-time homebuyers. A federal government program allows for tax-free RRSP withdrawals to help finance the first purchase of a new home; yet only six per cent of 18 to 34-year-olds withdrew money from their RRSP to purchase a home in the past year.

“Younger Canadians’ relatively low participation in the government’s first-time homebuyer’s program may in part reflect a lack of understanding about what an RRSP can do for you well ahead of your retirement years,” added Davies. “The start of the year is a very good time to sit down with your financial planner or visit your bank branch and find out what your retirement and investment options are and to make sure you are making the most of the resources available to you.”

2010 RRSP Fast Facts – Canadians aged 18 to 34

  • The number of Canadians aged 18-34 who have RRSPs dropped to 39 per cent, which is the lowest number in almost a decade and a five percentage point drop from 2009.
  • The overall number of Canadian adults who have RRSPs jumped to 61 per cent, up from 54 per cent in 2009.
  • Canadian RRSP holders in the 18-34 age group are most likely to maximize their RRSP contribution (33 per cent) for the 2010 tax year.
  • A quarter of Canadians with RRSPs (24 per cent) plan to maximize their contribution for 2010.
  • Thirty-five per cent of all Canadians make regular weekly or bi-weekly contributions to their RRSPs with Canadians aged 18-34 making up almost half (47 per cent) of this group.
  • One-in-three RRSP investors (34 per cent) make regular contributions through a plan, 45 per cent of whom are Canadians aged 18-34.

Charts related to the 2010 RBC RRSP Poll are available online at www.rbc.com/newsroom.

Whether Canadians want RRSP and retirement savings advice or to borrow with confidence, the RBC Advice Centre (www.rbcadvicecentre.com) is updated regularly to reflect current trends and answer the questions that are top of mind. Interactive tools and calculators provide customized information covering many facets of personal finance.

Poll background
These are some of the findings from the RBC 21st Annual RRSP Poll conducted by Ipsos Reid between October 29 and November 4, 2010. For this survey, a national sample of 1,457 adults from Ipsos’ Canadian online panel were interviewed, of which 184 were 18 to 34-year-olds. The results are based on samples where quota sampling and weighting are employed to balance demographics and ensure that the sample’s composition reflects that of the actual population according to Census data. Quota samples with weighting from the Ipsos online panel provide results that are intended to approximate a probability sample. A weighted probability sample of 1,457 Canadian respondents, with 100 per cent response rate, would have an estimated margin of error of ±3 per cent, 19 times out of 20. A weighted probability sample of 184 18 to 34-year-old respondents, with 100 per cent response rate, would have an estimated margin of error of ±7.2 per cent, 19 times out of 20.

Your Future by Design® is RBC’s distinctive approach to help clients identify, plan, and realize their goals for retirement. With the guidance of RBC financial planners and investment and retirement planners, Your Future by Design helps clients create a blueprint for a successful lifestyle and financial plan for retirement based on what is truly important to them in key areas in life, including family, health, home, lifestyle, work/business, mind and spirit, and legacy. To find out more about how RBC can help build a blueprint for the future, visit www.rbc.com/yourfuture or call 1-866-335-4055.

TransUnion To Pay $5,000 For Privacy Breach

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A federal court judge has set a precedent by ordering TransUnion of Canada Inc. to pay $5,000 in damages to a Calgary man who was turned down by a bank after another man’s credit history was wrongly forwarded. 

Federal Court Justice Russel Zinn ruled that on the basis of the privacy breach and repeated failures by the credit rating agency, TransUnion of Canada to correct the “grossly inaccurate” information quickly and effectively a payback to the victim is warranted, along with an award of $1,000 in legal costs.

Mirza Nammo represented himself in court and persuaded Justice Zinn to make the first ever damage award for a breach of the federal privacy act, the Personal Information Protection and Electronic Documents Act (PIPEDA).

Justice Zinn compared the dissemination of false credit information to a strip search in that it lays “bare to those receiving the information the creditworthiness of a person” and therefore can be “equally intrusive, embarrassing and humiliating as a brief a respectful strip search”.  Zinn also elaborated that in this case, while the act was “serious,” it was “relatively brief and not extremely disrespectful” and therefore warrants “moderate” damages.

The situation started when Nammo went to the Royal Bank of Canada (RBC) for a loan to help start a trucking business with a partner.  The next day RBC advised him that his loan was not approved “because he had ‘bad credit’ and his partner did not have a financial background sufficient to support a loan of the necessary amount on his own credit.”

It didn’t take long for Nammo to discover that TransUnion had provided RBC with information that came from a collection agency and was related to a man with a different name and date of birth and who had never lived at any of the same addresses Nammo had lived at.  We’re not talking about a minor difference either, Nammo is 44 and the other person is 28.

Although the collection agency denied passing on the information related to Nammo, it was a bureaucratic mess to correct the record.  So much so that Zinn found that overall TransUnion “failed to collect accurate information” on Nammo, failed to correct the erro and failed to take responsibility to begin with. 

In the end Nammo won the day with the judge saying that the credit rating agency’s attempts to lay blame on Nammo during arguments in court was “offensive”.

This ruling could set the stage for many more lawsuits against not just banks, but any bureaucratic organization whose employees are negligent in their diligence or in listening to common sense.  With more cases like this it will eventually cause corporations to implement some common sense within their organizations rather than blind policies and procedures.  This is a subject that is covered in ‘The Banker Who Saved His Soul’.


Baldo Minaudo
President, MetroActive Lifestyle Network
Senior Consultant, Venturemind Corporation
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Canadian Small Businesses Resilient through Recession: RBC Economics

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TORONTO, January 5, 2011 — Canadian small- and medium-sized businesses (SMEs) better weathered the recession relative to large firms in the private sector, according to a new report on small businesses and the labour market from RBC Economics.

“Countering concerns that smaller enterprises are generally more impacted by economic downturns, we found that smaller businesses endured the recent recession better than their larger counterparts,” said Paul Ferley, assistant chief economist, RBC. “The relative success of private sector SMEs likely reflected lower exposure to external markets such as the United States, which saw greater weakness compared to Canada’s domestic economy.”

The RBC report focuses on private sector employment numbers, a key business indicator, and found that private SMEs in Canada with fewer than 300 employees were better able to cope with the effects of the recession and have been quicker to recover than larger private enterprises. In addition, businesses that depend on the U.S. export market had a more difficult time than those more focused on the domestic market which was not hit as hard by the recession.

“During difficult economic times, businesses often find themselves laying off workers and stalling their hiring initiatives,” said Mike Michell, director, Small Business, RBC. “However, private sector SMEs appear to have created business strategies that have ultimately helped them come out of the downturn relatively unscathed..”

Employment Performance
Overall, employment at private SMEs fell 4.2 per cent during the recession, in contrast to 5.5 per cent among larger private firms. Compared to large manufacturers, private sector SMEs seem to have had lower exposure to markets in the United States.

When looking at all firm sizes, private goods-producing industries – including manufacturing, construction, mining, oil and gas, logging, forestry and utilities – took the biggest hit to employment through the recession, declining 11.1 per cent from a fourth quarter peak in 2007.

Regional Findings
Trends in employment numbers at SMEs and large firms were found in most provinces across the country.

  • Newfoundland & Labrador: SME employment in the region remained strong during the economic downturn. Though payrolls on average declined by 1.2 per cent, they have since surpassed previous peak levels. In contrast, employment at large firms declined more sharply at 4.3 per cent. Manufacturing bore the brunt of the declines with total employment falling by 29.2 per cent, accounting for 90 per cent of the overall decline at large firms.
  • Nova Scotia: Employment in Nova Scotia was stable throughout the recession, although employees at large firms fared better than SMEs as payrolls reduced by 1.7 per cent and 2.9 per cent respectively. The domestic trade sector was the main source of weakness among SMEs, accounting for 44 per cent of job losses in this category.
  • New Brunswick: Manufacturing was the main source of job loss in New Brunswick with employment in this sector falling by 11.3 per cent between the third quarter of 2008 and the second quarter of 2009. Overall, employment among SMEs contracted 13.2 per cent compared to a drop of 9.6 per cent at large firms.
  • Quebec: Employment at large firms in Quebec fell 6.2 per cent, with more than half of the decline coming from manufacturing, while employment at private SMEs fell 2.6 per cent after peaking at the end of 2008. Transportation and warehousing sectors experienced general weakness with employment falling at SMEs and larger firms by 7.3 per cent and 5.7 per cent respectively.
  • Ontario: Job losses in Ontario’s manufacturing sector were responsible for half of the decline in total private-sector employment from the third quarter of 2008 to the fourth quarter of 2009. Within manufacturing, job losses were concentrated at large firms where employment fell by 19.2 per cent during this period, compared to a decline of 10.4 per cent at SMEs. Weakness was also recorded in the retail and wholesale-trade sectors where SMEs reduced payrolls by 4.1 per cent and large firms by 1.3 per cent.
  • Manitoba: Employment at Manitoba’s private SMEs held steady throughout the recession as larger firms reduced payrolls. As seen in other parts of the country, employment losses in Manitoba were concentrated within manufacturing, which accounted for the entire 1.5 per cent decline in employment at SMEs and one-third of the 8.1 per cent reduction in payrolls at large firms. The bulk of the remainder of large firm employment weakness was within the retail and wholesale-trade sectors, where employment fell by 10.8 per cent, but rose 0.5 per cent at SMEs.
  • Saskatchewan: While employment at larger firms plunged by 10.5 per cent, employment at Saskatchewan’s private SMEs increased by 1.8 per cent after initially falling 0.7 per cent. The decreases at large firms were more broadly based compared to other provinces and were led by declines in manufacturing (20.4 per cent), transportation and warehousing (22.3 per cent), and retail and wholesale trade (3.8 per cent).
  • Alberta: Private employment at SMEs in the province dropped 7.4 per cent compared to 5.6 per cent among large firms. The main driver appears to be in the construction sector where SME employment fell by 9.0 per cent compared to a gain of 1.1 per cent at large firms. The employment rate in the manufacturing sector of large firms fell by 19 per cent, whereas SMEs cut payrolls in the manufacturing sector by a more moderate 13.1 per cent. Employment at large firms in the mining, quarrying, and oil and gas extraction industries fell by 16.2 per cent compared to a decline of 7.7 per cent at SMEs.
  • British Columbia: Similar to Alberta, large firms in British Columbia generally outperformed their SME counterparts. Though private employment at large firms dropped 7.4 per cent peak to trough compared to the 6.9 per cent decline at SMEs, a subsequent rebound at large firms currently leaves the drop at 5.7 per cent. This was the case across the province during most of the recession with employment declines at SMEs generally greater relative to large firms. The greatest source of weakness for SMEs was in the construction sector, where payrolls fell by 11.6 per cent compared to an increase of 1.9 per cent at large firms. Most other sectors within the province reverted to the national trend of SMEs seeing less weakness relative to large firms. For example, the largest source of weakness overall was in the retail and wholesale trade sectors with employment at SMEs falling 5.1 per cent compared to 8.3 per cent at larger firms. Manufacturing in the province was also weak with SME employment falling by 11.4 per cent, although this was outpaced by a 14.3 per cent decline at large firms.

A complete copy of the report is available as of 8 a.m. ET, at
www.rbc.com/economics/market/pdf/sme.pdf.

About RBC
Royal Bank of Canada (RY on TSX and NYSE) and its subsidiaries operate under the master brand name RBC. We are Canada’s largest bank as measured by assets and market capitalization, and among the largest banks in the world, based on market capitalization. We are one of North America’s leading diversified financial services companies, and provide personal and commercial banking, wealth management services, insurance, corporate and investment banking and transaction processing services on a global basis. We employ approximately 79,000 full- and part-time employees who serve close to 18 million personal, business, public sector and institutional clients through offices in Canada, the U.S. and 50 other countries. For more information, please visit rbc.com.

For more information, please contact:
Margie McNeil, 905-606-1425, margie.mcneil@rbc.com

Elyse Lalonde, Media Relations, 416-974-8810, elyse.lalonde@rbc.com