Global Investment Solutions: MCT scores and Your Investment Portfolio by Bruce Friesen, President

Feb., 2012 – This article examines the impact of the upcoming regulations proposed by OSFI for the 2012 reporting period. The recent paper titled: Discussion Paper on OSFI’s Proposed 2012 Changes to the Minimum Capital Test / Branch Adequacy of Assets Test For Federally Regulated Property and Casualty Insurance Companies deals with a number of upcoming changes. The article focuses primarily on the Margin for Interest Rate Risk section which addresses asset liability mismatch. Of the new changes, this section has the potential to have the largest impact on a firm’s MCT score.

In the article we discuss the changes to the Asset Liability Test, the impact on the MCT and the portfolio’s rate of return. We also look at solutions that enable firms to make a return on their investment while eliminating mismatch risk.

Contributors to the article include: Doug MacDonald, President of Aviva Investors Canada and Cosimo Pantaleo, Senior Manager with the Ernst &Young, Property & Casualty Actuarial Practice.

For a copy of this article, please email [email protected]

About Global Investment Solutions

Global Investment Solutions and its affiliate Global Manager Research are based in Oakville, Ont. They are the publishers of the Property & Casualty Investment Monitor report. Their investment consulting practice focuses on providing Governance and Investment strategy to institutional clients. Contact: [email protected] or [email protected] For for more information, visit www.global-i-s.com.