May 27, 2020
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May 27, 2020

Your CFA Daily Update on COVID-19

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Ontario Extending Emergency Orders to June 9

The Government of Ontario declared a provincial emergency on March 17, 2020 under the Emergency Management and Civil Protection Act. This declaration of emergency was most recently extended on May 12, 2020 and is currently in effect until June 2, 2020.

Current emergency orders include the closure of outdoor playgrounds, play structures and equipment, public swimming pools and outdoor water facilities, as well as bars and restaurants except for takeout and delivery. Additionally, there continues to be restrictions on social gatherings of more than five people, and staff redeployment rules remain in place for long-term care homes and congregate settings like retirement homes and women's shelters.

FULL NEWS RELEASE

B.C.'s extends state of emergency by another two weeks

British Columbia also moved Wednesday to extend its state of emergency for another two weeks, making it the longest period of time it has been under such orders.

States of emergency can only be issued for two weeks at a time in B.C.

Manitoba: Restaurants, gyms, seniors’ centres can reopen Monday 

Businesses that were forced to shutter their doors due to COVID-19 will be allowed to start back up Monday under the second phase of Manitoba's reopening plan, which includes gyms, indoor restaurant spaces and seniors centres, manicurists and pedicurists, film production, pools and a wide swath of other businesses can all resume operating

The plan includes expanding capacity at child-care centres and opening bars at 50 per cent capacity.

Manitobans will also be allowed to travel north of the 53rd parallel from within Manitoba, though they are advised to stay home if they have any symptoms of COVID-19, which include many cold and flu symptoms. 

TSA Webinar
Canada-U.S. Relations After COVID-19
A Discussion with Experts

What can we expect as the Canadian economy emerges from the COVID-19 pandemic?

Please join TSA for an online discussion Friday, May 29, at 2:00 PM EDT, with our expert guests:

  • Rana Sarkar, Consul General for Canada for San Francisco and Silicon Valley
  • Veronica Clark, Senior Associate at Citi Research Economics

Rana and Veronica will give us their insights into the future of economic relations and trade between Canada and the U.S., including the future work in the virtual world, as we emerge from this historic pandemic.

Click here to reserve your attendance

Guest Speakers

Rana Sarkar – appointed as Consul General of Canada in San Francisco/Silicon Valley in 2017, with accreditation for Northern California and Hawaii. He is also a member of Canada’s NAFTA Advisory Council. Sarkar previously served as National Director for High Growth Markets at KPMG Canada, and Co-Chairman of the Advisory Board at the Munk School of Global Affairs, University of Toronto. From 2009 - 2013, he was President and Chief Executive Officer of the Canada-India Business Council.

Veronica Clark - joined Citi Research in 2015. She is a Senior Associate on the U.S. Economics team at Citi Research and a regular commentator providing insight on latest economic trends and patterns, including on Bloomberg. Prior to joining the team, she worked in Emerging Markets Strategy and G10 Short Term Interest Rate Trading. Veronica holds a Master’s degree in Economics from New York University and Bachelors in Mathematics and Economics from the University of North Carolina at Chapel Hill.

After registering, you will receive a confirmation email containing information about joining the webinar.

Please send any questions you would like addressed in the webinar to info@tsa.ca

Parts of N.S. economy, like hair salons, bars, gyms, can reopen if ready June 5

Parts of Nova Scotia's economy can begin to reopen June 5 if they're ready and follow public health protocol. If ready the following can reopen June 5: 

  • Restaurants for dine-in.
  • Bars, wineries, distilleries and craft beer taprooms.
  • Personal services like hair salons, barber shops, nail salons, spas and tattoo parlours.
  • Fitness facilities like gyms, yoga studios and climbing facilities.
  •  

Other health providers can also reopen on June 5 if they follow protocols in their college or association's plan, as approved by public health, including:

  • Dentistry and other self-regulated health professions such as optometry, chiropractic and physiotherapy.
  • Unregulated health professions such as massage therapy, podiatry and naturopathy.

Lounges are not permitted to reopen yet.

Bank profits cut in half as loan loss provisions spike by 500%

Over the past few days several of Canada’s Schedule 1 banks reported second quarter profits which were down significantly. Each bank is reporting for the three-month period that ended April 30, a quarter that saw Canada's economy walloped by the coronavirus that causes COVID-19.

Royal Bank reported adjusted earnings of $1.03 per share, well below the $1.58 that analysts were expecting. All told, Royal made a profit of more than $1.4 billion last quarter. But that's a drop of 54 per cent from what the bank made in the same stretch in 2019. A big reason for the profit plunge is a spike in loan loss provisions. That's the amount that banks set aside to cover bad loans. Royal hiked its provisions to $2.8 billion in the quarter, a huge jump from $426 million last year. On the other side of the ledger, Royal’s investor and treasury services division saw profit rise by 50 per cent to $226 million. And profits in the insurance division rose by 17 per cent to $180 million.

BMO's profit was lower than the $1.22 analysts were expecting. All in all, BMO earned $689 million in the quarter, well down from the $1.5 billion last year. And Bank of Montreal saw the same trend in loan loss provisions, with its figure rising from $176 million last year to $1.11 billion this quarter.

Scotiabank has set aside $1.85 billion for bad loans in the past quarter, more than twice as much as it did the same time last year. Scotiabank posted a profit Tuesday morning of $1.32 billion in the three months up to the end of April, a fall of more than 40 per cent from last year's level as the bank set aside twice as much money for loans that are not currently being paid back. The bank's provisions for credit losses totalled nearly $1.85 billion for the quarter. That's up 111 per cent from the $873 million worth of problematic loans the bank revealed in the same three months last year, well before the COVID-19 pandemic crushed the economy. Scotiabank ask revealed on Tuesday that 300,000 of its Canadian customers have applied for some sort of financial relief on the $60 billion they collectively owe to the bank. That would include mortgagees who asked for interest rate deferrals.

National Bank of Canada's net income plunged 32 per cent in its second quarter as it put aside five times the provisions for credit losses than it did a year ago due to the economic storm triggered by the COVID-19 pandemic. After markets closed it reported net income of $379 million for the period ended April 30, compared with $558 million in the same quarter last year.

The Canadian Imperial Bank of Commerce and Toronto-Dominion will post their numbers in the coming days.

Alberta cuts training for barbers

Alberta has expanded the hairstylist apprenticeship program to include barber certification, enabling apprentices to choose the path that best meets their needs.

The new barber certification path enables apprentices to streamline their training and achieve certification in half the time. Hairstylist apprentices wishing to switch programs or who are currently working as a barber can receive credit for training they have already completed.

Shopping centres reopening in Quebec (outside Montreal) June 1

Quebec's Minister of Economy and Innovation Pierre Fitzgibbon confirmed the reopening of shopping centres as of June 1 for all regions of Quebec, except for the Greater Montreal area and Joliette. The epidemiological situation is being studied very closely following the reopenings in order to determine whether or not there is a risk of a second wave.

CNESST has published a detailed protocol on the sanitary upgrading of shopping centres as well as a list of mandatory daily checks for each merchant and shopping centre.

The measures include:

  • A limit on the number of customers;
  • Installation of partitions at transaction counters;
  • Maintaining the closure of dining areas; only take-out meals will be permitted;
  • Traffic directions can be indicated on the ground;
  • Increasing the number of security guards to enforce the 2-metre distance;
  • Increasing the number of security guards;
  • Denial of access to any person with symptoms;
  • Recommending that masks be worn.

CFA NATIONAL SPONSOR

National Sponsor: BDO

As an international accounting firm with more than 100 offices across the country, BDO offers our clients value-added guidance, anywhere they do business. BDO’s franchising professionals have the expertise to help Franchisors and Franchisees plan and implement key business and financial strategies to deal with a range of business issues. From compliance such as FDD reporting, domestic and international tax strategies and risk management, to financing, M&A and strategic growth services, we can help you accomplish your goals. We understand the challenges of the industry today, and we are here to help you as your business partners and advisors.

Contact:
Lyn Little, CPA, CA
Partner, National Franchise Leader
BDO Canada LLP
Direct: 905-633-4942
llittle@bdo.ca

Webinar Series On Demand

UPCOMING WEBINARS

JUNE 2, 2020
AT 2:00 PM ET

Hands-On Approach to Commercial Real Estate  
 50 CFE PARTICIPATION  CREDITS  

SPEAKERS: Armen Khajetoorian and Kwaku Tabi, Cassels, Brock & Blackwell LLP

Commercial real estate has been a hot topic throughout COVID-19. Join us for a deep dive into commercial real estate leasing issues and gain a practical take-aways through a “how-to” approach to challenges you may be facing.

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Feedback from our Members

“I would like to take this moment to express how amazing the CFA webinar series has been for myself and my stores. I am regularly sharing the information and enjoy the daily "break" around lunch time, basically having a nearly daily lunch and learn”

 - Suzanne Howie, Franchise Support, Print Three Franchising Corp.

COVID-19's impact on the world is creating waves across all sectors and industries.

Every member of the CFA community is dealing with an issue that is affecting the world, our industries, our communities, our businesses, and our people.

We would like to hear from you if you have any topics, issues or questions to navigate turbulent times in order to support you further: 

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