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44 minutes ago, livinthelife said:

MD Financial/CMA just announced today that the company will be sold to Scotia bank. Do you think this will effect the class of 2022 from receiving an MD financial backpack?? 

No I don't because 

a) they have already bought those bags. It is too late in the game

b) it will operate as an independent branch of Scotia's wealth management firm - one that will be unlikely to abandon any of its existing successful tactics. 

that being said the entire move seems a bit odd - a lot of physicians aren't reacting well. MD is supposed to be "for physicians" and now that it is attached to a bank you have to wonder even more about that. 

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4 minutes ago, rmorelan said:

No I don't because 

a) they have already bought those bags. It is too late in the game

b) it will operate as an independent branch of Scotia's wealth management firm - one that will be unlikely to abandon any of its existing successful tactics. 

that being said the entire move seems a bit odd - a lot of physicians aren't reacting well. MD is supposed to be "for physicians" and now that it is attached to a bank you have to wonder even more about that. 

Im very curious as to what the branding on the bag would be since it previously had CMA's logo

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1 minute ago, Easthopeful said:

Im very curious as to what the branding on the bag would be since it previously had CMA's logo

At the closing of the Acquisition, Scotiabank and CMA will enter into a 10-year collaboration pursuant to which CMA will exclusively promote Scotiabank as the preferred provider of financial products and services to physicians and their families in Canada and, as part of the arrangement, both parties will jointly support philanthropic initiatives and other programs for physicians and the communities they serve.

That doesn't suggest the CMA is out of the way here at all - the CMA will probably remain. I am guessing here but having an actual bank brand on the bag as well is not exactly going to go over well at the schools - MD was already operating on the thin ice in that way. 

More to the point though, and this is important - the bags are not something that have to be locked into MD financial. We all could collectively through the CFMS pick a bag colour and arrange for them to be bought that way at roughly 50 dollars per med student at most. Already Ottawa has their own bags - nice ones too I might add as they don't allow this kind of sponsorship. Medical student councils do have a lot of money at there disposal through a variety of sources (my council raised roughly 30K for instance in my year). Through fund raising, or asking the incoming class to pay for them in part through the O Week fees nothing really would stop this tradition to continue. We are not constrained by an outside financial institution - particular now that it is pretty clear it is a for profit enterprise (their profit is your loss.........)

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1 hour ago, rmorelan said:

At the closing of the Acquisition, Scotiabank and CMA will enter into a 10-year collaboration pursuant to which CMA will exclusively promote Scotiabank as the preferred provider of financial products and services to physicians and their families in Canada and, as part of the arrangement, both parties will jointly support philanthropic initiatives and other programs for physicians and the communities they serve.

That doesn't suggest the CMA is out of the way here at all - the CMA will probably remain. I am guessing here but having an actual bank brand on the bag as well is not exactly going to go over well at the schools - MD was already operating on the thin ice in that way. 

More to the point though, and this is important - the bags are not something that have to be locked into MD financial. We all could collectively through the CFMS pick a bag colour and arrange for them to be bought that way at roughly 50 dollars per med student at most. Already Ottawa has their own bags - nice ones too I might add as they don't allow this kind of sponsorship. Medical student councils do have a lot of money at there disposal through a variety of sources (my council raised roughly 30K for instance in my year). Through fund raising, or asking the incoming class to pay for them in part through the O Week fees nothing really would stop this tradition to continue. We are not constrained by an outside financial institution - particular now that it is pretty clear it is a for profit enterprise (their profit is your loss.........)

Sounds a little sketchy...what does the CMA get out of this, and why aren't they disclosing. They certainly didn't do it for "philanthropic" reasons.

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2 hours ago, livinthelife said:

MD Financial/CMA just announced today that the company will be sold to Scotia bank. Do you think this will effect the class of 2022 from receiving an MD financial backpack?? 

Don't worry, we'll get the backpacks.   In the orientation booklet we got from U of C, they  say they will be distributing them on July 4th, in our orientation. If  U of C students are getting the backpcks, I am sure all the other med students will get them as well :)

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7 minutes ago, PhD2MD said:

Sounds a little sketchy...what does the CMA get out of this, and why aren't they disclosing. They certainly didn't do it for "philanthropic" reasons.

This is basically a divestiture - so CMA would get a big lump-sum. Provided the $2.6B deal is settled on a net basis (with Scotiabank buying all the MD Financial's assets and debts), CMA would suddenly have freed up $2.6B cash. There may have been a strategic reasoning to this and so strategic to the point where Scotia is doing a secondary offering to raise capital for the purchase - with future use of funds in other regards. But there obviously a lot of goodwill and intangibles factored in this deal because MD Financial was always seen as the go-to resource for physicians. 

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40 minutes ago, la marzocco said:

This is basically a divestiture - so CMA would get a big lump-sum. Provided the $2.6B deal is settled on a net basis (with Scotiabank buying all the MD Financial's assets and debts), CMA would suddenly have freed up $2.6B cash. There may have been a strategic reasoning to this and so strategic to the point where Scotia is doing a secondary offering to raise capital for the purchase - with future use of funds in other regards. But there obviously a lot of goodwill and intangibles factored in this deal because MD Financial was always seen as the go-to resource for physicians. 

as you can imagine there were immediate queries as to where that money is going - 2.6 billion but 85,000 members. That is roughly 30K per doctor in Canada

They control almost 50 billion in assets. I will let you do the math as to how much doctors have invested with them :) Hint - it is a very large number - and that equals a ton of management fees ha.  

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3 minutes ago, rmorelan said:

as you can imagine there were immediate queries as to where that money is going - 2.6 billion but 85,000 members. That is roughly 30K per doctor in Canada

They control almost 50 billion in assets. I will let you do the math as to how much doctors have invested with them :) Hint - it is a very large number - and that equals a ton of management fees ha.  

dollar bills~~ haha

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8 minutes ago, la marzocco said:

dollar bills~~ haha

absolutely - which makes you wonder why exactly we felt the need to share anything with anyone - particular a bank no less ha. 

Apparently together we are going to do some charity work with the some of the money. 

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26 minutes ago, rmorelan said:

absolutely - which makes you wonder why exactly we felt the need to share anything with anyone - particular a bank no less ha. 

Apparently together we are going to do some charity work with the some of the money. 

From their FAQ: "portions of the proceeds will be used wisely in support of the CMA's policy and advocacy mandate to advance key priorities for our members and Canadians.".

I think it's the "wisely" in that response that irritates me the most.  Comes across as smarmy and condescending. 

My irritation is only slightly lessened by my amusement at pm101's first reaction to the deal: "ohmigod, what about the backpacks!"  ;)

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3 minutes ago, ploughboy said:

From their FAQ: "portions of the proceeds will be used wisely in support of the CMA's policy and advocacy mandate to advance key priorities for our members and Canadians.".

I think it's the "wisely" in that response that irritates me the most.  Comes across as smarmy and condescending. 

My irritation is only slightly lessened by my amusement at pm101's first reaction to the deal: "ohmigod, what about the backpacks!"  ;)

Saw this elsewhere: https://www.ctvnews.ca/canadian-doctors-ask-for-proper-pension-plan-1.408068

  • Many doctors in Europe have access to group pension plans. The U.K., for instance, has an exemption in its tax law that acknowledges that fee-for-service doctors working in the National Health Service aren't regular small business people, since they can't set their own fees. So they have government-backed, defined-benefit pensions.
  • The doctors argue that every other health professional organization that works under the Canada Health Act is treated like a union and gets paid a pension from its union by the government. But physicians are locked out. What's more, they say, doctors across Europe have group pension plans, but Canadian laws prevent them from doing the same.

.. so I am partly wishful thinking at 11pm at night hoping one day I would see a proper pension plan lol

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1 hour ago, la marzocco said:

 But there obviously a lot of goodwill and intangibles factored in this deal because MD Financial was always seen as the go-to resource for physicians. 

Globe and Mail has the purchase price at 5.3% of Assets Under Management, with a 1%-3% being more typical. 

Scotia just bought preferred access to 80 000 high income, high net worth, very busy, and (generally) financially clueless individuals.  And is going to have the CMA shilling Scotia's offerings to its members for the next 10 years.

Smart move on Scotia's part.  And who knows, maybe it will turn out well for Canadian docs if Scotia can provide valuable services to us.  But right now my gut reaction is that I don't like the deal.

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7 minutes ago, ploughboy said:

Globe and Mail has the purchase price at 5.3% of Assets Under Management, with a 1%-3% being more typical. 

Scotia just bought preferred access to 80 000 high income, high net worth, very busy, and (generally) financially clueless individuals.  And is going to have the CMA shilling Scotia's offerings to its members for the next 10 years.

Smart move on Scotia's part.  And who knows, maybe it will turn out well for Canadian docs if Scotia can provide valuable services to us.  But right now my gut reaction is that I don't like the deal.

I won't be surprised if the purchase price equation shows 30% of the purchase price being allocated to "customer lists" or "goodwill" or "brand intangibles" of sorts.. exactly to your point.. the customer list of high income high net worth individuals is already worth a lottttt

Scotia will likely present the purchase price breakdown in their financial statements in Q3/Q4 this year when they finalize the deal.

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13 minutes ago, la marzocco said:

.. so I am partly wishful thinking at 11pm at night hoping one day I would see a proper pension plan lol

My tired, cynical, born-in-the-dark-but-not-last-night feeling is that the 2.5 (pinky finger to corner of mouth) Billion dollars will be administered by a small appointed board, who will need nice offices in a high-rent area, a good pension and benefits, and lots of first class travel to nice destinations.  You know, to help advance those "key priorities" which the average Canadian doc may (or may not) agree with, but likely won't have a direct say in selecting. 

A pension plan for Canadian docs?  Ha.  Can't see that being one of those key priorities.

But I just spent a week in the unit, so I kinda hate everything right now.  Maybe I'll be more enthusiastic about it in a few days.

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2 minutes ago, ploughboy said:

My tired, cynical, born-in-the-dark-but-not-last-night feeling is that the 2.5 (pinky finger to corner of mouth) Billion dollars will be administered by a small appointed board, who will need nice offices in a high-rent area, a good pension and benefits, and lots of first class travel to nice destinations.  You know, to help advance those "key priorities" which the average Canadian doc may (or may not) agree with, but likely won't have a direct say in selecting.  A pension plan for Canadian docs?  Ha!

But I just spent a week in the unit, so I kinda hate everything right now.  Maybe I'll be more enthusiastic about it in a few days.

we are better off if we learn the skills to do it on our own. Clearly we aren't bad at the saving part at least with the 50 billion in assets. 

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10 minutes ago, la marzocco said:

I won't be surprised if the purchase price equation shows 30%+ of the purchase price being allocated to "customer lists" or "goodwill" or "brand intangibles" of sorts.. exactly to your point.. the customer list of high income high net worth individuals is already worth a lottttt

Scotia will likely present the purchase price breakdown in their financial statements in Q3/Q4 this year when they finalize the deal.

....and that is the part of the annoying part. Not just the lists - but all the financial assessments they do to create a personal plan. That often involve ALL assets, and the spouses income etc as well - the total package. It is a marketing gold mine. 

 

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1 minute ago, rmorelan said:

we are better off if we learn the skills to do it on our own. 

Absolutely agree.  But docs who do that are in the minority. And if Scotia provides valuable services to the Canadian physician community, over and above what MDM could provide as a stand-alone, then God bless 'em.

I think part of my irritation is that MDM was started by CMA as a service to the membership precisely *because* docs have high income and net worth but don't always have the greatest financial savvy.  And now out of the blue CMA has taken that goodwill (of both the financial and non-financial variety), monetized it, and is going to do heaven knows what with the money.

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1 minute ago, rmorelan said:

....and that is the part of the annoying part. Not just the lists - but all the financial assessments they do to create a personal plan. That often involve ALL assets, and the spouses income etc as well - the total package. It is a marketing gold mine. 

 

Did you read the Scotia press release?  So many references to "cross-selling" in it!

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I personally don't mind managing my own money, but I certainly wouldn't mind giving some of my income to a pension plan institutional-type investor (like HOOPP) who can help me achieve some sort of defined benefit in the long-run. I am also lazy.. so having a defined benefit pension plan would definitely be consistent with my laziness :P 

Some would argue.. just throw your money into ETFs etc.. and rebalance annually blah blah it's not hard..but I am lazy.. so.. i digress

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4 minutes ago, ploughboy said:

Absolutely agree.  But docs who do that are in the minority. And if Scotia provides valuable services to the Canadian physician community, over and above what MDM could provide as a stand-alone, then God bless 'em.

I think part of my irritation is that MDM was started by CMA as a service to the membership precisely *because* docs have high income and net worth but don't always have the greatest financial savvy.  And now out of the blue CMA has taken that goodwill (of both the financial and non-financial variety), monetized it, and is going to do heaven knows what with the money.

It is the same problem though - the fees they will charge will transfer say 30-40% of our retirement wealth to "X" corporation - I don't really care if that is scotia or MD Financial. The entire point of MD financial should have been to do this better and cheaper. Instead we get this

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