Canadian Wealth Managers Cut Costs To Fortify Against Downturn

1 April 2009

Canaccord Capital, the Vancouver-based financial services group that includes a wealth management arm, is extending its cost reduction programmes to include measures like consolidation of back office support and deferral of certain rewards programmes, according to its quarterly statement.

"Canaccord is a resilient and resourceful organisation, with a solid plan in place for the future," said Paul Reynolds, president and chief executive of Canaccord Capital. "We believe our goals of lowering our breakeven, modernising our compensation structure and ensuring the efficiency of our operations are critical to our continued success."

The company said the cost reduction plan would make savings of nearly $15 million, which will be in addition to the nearly $20 million it expects to save annually from similar measures announced in February.

The move comes after the group said it would cut 20 per cent of its domestic brokers in Canada - about 75 of 375 - on Tuesday, due to the effects of the financial crisis. It will be the group's second round of job losses in five months; 170 jobs were cut in October for similar reasons. The latest cuts will be made in the next 90 days.

Canaccord is publicly traded on both the Toronto Stock Exchange and AIM. The group has 31 offices worldwide, including 24 private client services offices across Canada.