Laurentian Bank Cuts Dividend 40% | Page 2 | LBC Digital | Discussion forum

Briguy said
@Loonie it might look bad to other family members if I had her set me up in a joint account with her. What will probably end up happening is that after Covid I will go with her to bank and have myself set up as the POA instead of my other family member. I'm also POA outside the bank, but as you mentioned, banks want you to be POA in their paperwork.  

Let's hope she is still able to make that trip to the bank with you whenever covid may be under control.

Yes, the banks want you to use their forms. But for many people the issue of employing the forms previously signed does not come up until the person is no longer able to go to the bank and/or make decisions.
I recall that a few years ago the banks had their knuckles rapped for not accepting forms from lawyers and requiring people to fill out forms issued by the bank. The issue was that forms filled out at the bank could/would nullify forms filled out at the lawyer's in respect to other applications thereof, depending on which was more recent. That was about 10-15 years ago, and it was effective in Ontario. At that time the banks either agreed or were ordered to stop this practice. That's why I was so surprised when it reared its ugly head again. Seems to me the lawyers and the banks need to get together and decide on a form that is acceptable to all; and banks should accept lawyer-generated forms that pre-date this. I would like to know what happened to that earlier agreement or order.

I also find it incredible.
But it's true. And there is a lot more I could say about it but prefer not to discuss. They do allow very limited access but it is not much different than if I hadn't had the POA at all.
Lawyer can't do anything. These decisions are made by bank lawyers, and their job seems to be to stop you from doing what you need to do and to make sure the money stays in the bank. Also, I am told that the big banks have the major law firms all on retainer so that nobody can get access to the best help against them.

The only excuse they could possibly have is that some people have indeed taken advantage of the funds of people over whom they have POA. But they are, in my view, obligated to honour the intentions of the client, especially when there is no history of wrongdoing on the part of the POA and the POA has been known to them for many decades as a client. They act as if the client gave THEM the POA.

As I said, there is a whole lot more to this story and it would probably scandalize most if not all readers to hear it all.

I'm just warning people hat they too could find themselves in this impossible position. And another warning: it's even worse for any kind of TFSA, RSP etc.

AltaRed said
We are going way off topic, but I can't imagine why a POA perfectly valid in the province in which it is created is not automatically accepted (must be accepted) by any institution in that province. I know the lawyer who put together my POAs would be all over a business that didn't accept what I have in place.  

Agreed that this skewed way off topic, but is an important conversation to have. Perhaps a splitting off of the POA-related posts from approximately post # 15 (it was the post on Scotiabank's processes for accepting power of attorneys that steered us in to the discussion) might be in order?

Anyway, I agree with @AltaRed that a power of attorney valid in one province is valid in another province in which the bank/bank branch is located. Having said that, banks are perfectly within their rights not to accept any power of attorney for any reason, as far as I'm aware. Some of the reasons could include two attorneys for the same client submitting separate power of attorney documents, signed at different times and each with the capability of acting alone, but where the bank may suspect one or both don't have the best interests of the client in mind. They could also reject a more recent power of attorney from a spouse when they already have a power of attorney, including a bank POA, from a child who is more well known to the bank. Where the bank doubts the mental capacity of the client at the time of signing, they may reject any POA signed on or after the known date of what they viewed as the client's diminished mental state.

Nevertheless, the Canadian federally-regulated banks agreed to a new Voluntary Code of Conduct with respect to POAs and joint deposit accounts. The Voluntary Codes of Conduct have the same, or similar, force and regulatory effect as Regulations enacted by the federal cabinet in the sense that the Financial Consumer Agency of Canada has the power to investigate, enforce, and levy at least warnings or penalties for transgressions of any of the Codes.

Full text: https://cba.ca/Assets/CBA/Documents/Files/Article%20Category/PDF/vol-poa-joint-account-en.pdf

A bank POA form can be called for, and for the sake of expediency, I'd recommend complying; otherwise, you may have your POA submitted for a lengthy/seemingly endless legal review if the particular branch is not comfortable with reviewing and accepting it in branch. This is one of those things where acceptance varies not by bank but by branches of a given bank. 🙂

While more costly than a POA, if you want an iron clad way of handling a loved one's affairs, you can petition the court for a committeeship. I'm not sure of all of the requirements, but the person would likely have to be not capable of managing well their financial affairs. This won't solve every use case of the POA, but for the most crucial ones where you are getting pushback from a bank, it's worth exploring.

Cheers,
Doug

pwr1019 said

Doug said

National Bank did cut their dividend in 1992 and, I think, even in 2008 as well, but honestly, they have been the best performing bank stock for the past few years 

Not true National Bank cut their dividend in 1992 (28 years ago) but since has only increased it from 5 cents a quarter to 71 cents

https://www.nbc.ca/content/dam/bnc/a-propos-de-nous/relations-investisseurs/fonds-propres-et-dette/2019/dividend-paid-share-1980-todate.pdf  

To be clear, I did say, "I think." Nonetheless, a cut is a cut is a cut, whenever it occurred. And, the market seems to have shrugged that off. This, too, shall pass. But I wouldn't buy Laurentian Bank yet as I do think it's too soon and there's likely more downside until they've worked through significant operational headwinds.

Cheers,
Doug

Companies have a fixed number of shares issued (unless//until they make another public offering to raise capital, or they buy back their shares). SO, it makes no difference to a company whether you sell your shares or not. It has no direct impact.

LB has over 43 million shares outstanding and daily volume today was over 230k shares (an average day for them). Neither LB, nor the market, cares about your shares. LB only begins to care when buyers in aggregate become increasingly reluctant to offer Bid prices that are close to Ask prices and thus drive market prices down.

picassocat said
Well for me, I'll lower the bid size buy not bidding at all. You lower the dividends, I sell and I will never look back. They don't care and I don't anymore. It's their reputation, not mine.  

Do you own National Bank of Canada, or one of the Big 5 banks, both of which have cut their dividends in the last 15 and 100 years, respectively?

Cheers,
Doug