$611 million in Sears Canada dividend payments under review by court monitor + MORE Jan 17th

TORONTO _ Hundreds of millions of dollars of dividends doled out to Sears Canada shareholders are coming under scrutiny by the former retailer’s court-appointed monitor, according to a new report in the company’s insolvency proceedings.
The report also highlights the tens of millions of dollars the failed chain, which faces a more than $260-million pension deficit and has laid off roughly 15,000 employees, has paid for legal representation in the process.
FTI Consulting Canada Inc. will review some transactions, payments and dividends the retail chain entered into, made or declared before they filed for protection under the Companies’ Creditors Arrangement Act, according to the latest report it submitted to the Ontario Superior Court of Justice on Monday.
Of particular interest to the monitor are a $102 million dividend payment on Dec. 31, 2012 and a $509 million dividend payment on Dec. 6, 2013.
The monitor is reviewing documents and gathering additional information, “including engaging with certain independent directors and senior Sears Canada management personnel, who had direct involvement” in at least some of the transactions…

The Bank of Canada raised its benchmark interest rate to 1.25 per cent Wednesday and signalled that, barring certain risks, more hikes are likely in the rest of the year. That’s creating an unusual situation for Canadians: for the first time in years, those renewing mortgages will be faced with higher rates and an increase in payments.
Even before Wednesday’s decision, five of the country’s largest banks hiked five-year fixed rates 15 basis points to 5.14 per cent last week. (CIBC is still offering 4.99 per cent.) In a country where consumers have grown accustomed to low rates, and where households are burdened with record levels of debt relative to income, this kind of change is worth noting. A recent survey published by insolvency trustee MNP Ltd. found 48 per cent of Canadian respondents were $200 or less away from being unable to fulfill their monthly financial obligations, an eight point increase since September.
READ: Higher rates could spell comeback for 5-year mortgages
The below chart shows the conventional fixed five-year mortgage rate, which is an average of the Big Six banks’ posted rates, published by the Bank of Canada over the past decade…

The court appointed monitor for Sears Canada’s insolvency says it is reviewing millions of dollars the company paid in dividends while its pension fund fell short.

TORONTO — Many consumers will soon find their debt loads heavier now that Canada’s central bank and the country’s biggest commercial lenders have raised their benchmark rates by one-quarter percentage point.
The country’s biggest banks raised their prime rates after the Bank of Canad hiked its overnight lending rate Wednesday by a quarter of a percentage point to 1.25 per cent.
READ: Your mortgage is about to get more expensive
It’s a challenge for Canadians still struggling to cope with the record amounts of consumer debt they amassed after the 2008 financial crisis because lenders use their prime rate as a benchmark for setting some other short-term rates including variable-rate mortgages and lines of credit. A hike is good news for savers as the prime rate also affects interest rates for savings accounts.
If you’re contemplating how to best take advantage of the increased rates or avoid falling into further debt, personal finance expert and Ryerson University business professor Laleh Samarbakhsh shared her advice…

Producers remain cautious amid concerns the market may be overheating