Review of Borrowing Framework of Major Federal Government-Backed Entities : 4
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Appendix H

Appendix I

Attributes

• Direct Borrowing Costs

• Management of the Canada Credit

• Diversity and Appropriateness of Borrowing Products

• Quality and Liquidity of Canadian Capital Markets

• Financial Reporting

• Borrower Liquidity

• Borrowing Operations

• Financial Risk Management

• Governance and Accountability

Direct Borrowing Costs

Why Relevant?

• The publicly stated fundamental objective of the Debt Management Strategy of Finance Canada is to raise stable, low-cost funding for the Government of Canada.

• In the broader macroeconomic context of public policy, any issuer benefiting from the Canada Credit has a responsibility to Canadian taxpayers to achieve the lowest possible risk weighted cost of borrowing.

All-in Cost of Borrowing

• It is important to take into account spreads, commissions and infrastructure costs.

Infrastructure

• Based on our interviews, Treasuries of Borrowers collectively employ 58 people, but not all of these are involved in direct funding operations.

• This aggregate headcount would likely not change significantly under a centralization scenario

– the Borrowers will retain their in-house ALM, debt management, liquidity management, lending and insurance program support and investment management expertise ;

– the few resources (if any) that Borrowers could save would be needed at the CFE.

• Despite there being some overlap, there is no standard trading or information system between the Borrowers.

• Any assessment of alternatives other than the status quo would need to analyze and take into account the transition costs required to modify the existing treasury infrastructures.

Cost of Funds (“COF”) Targets

• Short term: for money market CAD and USD activity, Borrowers established targets ranging from:

– T-Bill flat to +5 bps or US LIBOR -10 bps to -20 bps;

– All-in COF achieved over the last year ranged from T-Bill +1 bp to T-Bill +2.5 bps;

– No commission paid by borrowers for money market issuance.

• Floating rate and fixed rate term financing

– Depending on the characteristics of their funded assets, Borrowers will set their targets either in terms of Canada Bonds (“CB”) or in floating rate terms.

– Observed targets thus ranged from:

• Above targets for floating and fixed rates are all-in, including commissions.

Risk Weighted Cost of Funds

• Currently no formal risk weighted cost of fund methodology is in place – and structured products bear more risk than vanilla products.

• Targets posted by some Borrowers (who are the most active and have the longest expertise in issuing structures) are much more aggressive than for vanilla issues of similar maturities; we understand that all these issues are “reverse inquiry” (proposals made by dealers) and that the Borrower needs the capacity to independently vet that its resulting cost of funds through structured notes does fully price the credit risk as well as the option granted to the counterparty to call the issue.

• Structured notes includes the following additional risks:

  • Valuation, complexity and counterparty risk issues.

  • Reliance, in certain structures, on indices which may have difficulties in the long term.

  • Investor response risk when called.

  • Rollover (refinancing) risk when called.

Management of the Canada Credit

Why Relevant?

• The Government of Canada has a AAA rating, and is well-respected as a borrower in Canadian and international markets.

• The Borrowers are using the same credit, i.e. their borrowing programs depend upon their reputation and AAA rating of GOC.

• Actions taken by parties that share a rating will impact all of the other parties.

• As a sovereign, the market and public perception of the Canada Credit is critical. In this connection, the

“move to auctions by the government for the issuance of securities denominated in its domestic currency was in line with the evolution of practices of other major sovereign countries.”^[1]

• GOC’s borrowing must be seen as having a transparent process that is fair to all market participants. Over the last few years, Finance Canada and the Bank of Canada have implemented a number of measures to improve transparency of the Canadian fixed income markets, while aiming at a balanced trade-off between greater transparency and market liquidity. And these developments occurred in a context of shrinking debt issuance and increased concentration among fewer primary dealers.^[2]

Observations on Market Perception and Process

• While sharing a rating with GOC, the Borrowers have their own distinct market reputations, which are generally high.

• Most sovereigns use the auction process, as used by GOC, as it is the most transparent.

• CHT does not issue via auction, but does have quarterly issuances that are expected by the market.

• The other Borrowers are “opportunistic”, in that they do not issue any benchmark or regular issuances, instead monitoring the market and executing borrowing when market conditions are favourable versus their desired borrowing costs.

Diversity and Appropriateness of Borrowing Products

Why Relevant?

• Market perception and reputation are extremely sensitive factors for GOC.

• Exploring innovative ways to address the shrinking debt concept is encouraged as is the maintenance of a variety of funding channels.

• The benefits of structures have to be looked at in terms of risk-adjusted cost of funds.

• Funding through retail oriented structured products raises public policy and reputation risk issues that ought to be carefully weighted.

Observations

• The Borrowers, except CMHC and CHT, issue structured notes to reduce their borrowing costs; in fact, structured finance allows the Borrowers to obtain lower-cost floating rate funding than would be achievable by issuing commercial paper (replicates existing financial products at a lower cost).

• This Borrower approach is not dissimilar to many other “agencies” around the world.

• It provides access to niche markets where sovereigns are not typically present (less than USD 10 million) and where Borrowers are most appreciated by investors because of their clear ownership structure (the ultimate credit risk is sometimes less clear for European quasi sovereigns).

• Through their structured MTNs, Borrowers fill a market need by issuing synthetic products which are otherwise not available in the marketplace and hence meet specific investor demands, i.e.

  – Financial instruments to match institutional investors' requirements for higher returns during low-interest-rate periods or for purposes which relate directly to an individual investor’s other portfolio requirements

  – Allow investors to take market risk but minimize credit risk through a principal protected AAA rated underlying issuer.

• Dealers value MTNs due to the commission and derivative income they generate while servicing the needs of borrowers and investors.

• Structured notes issued by the Borrowers allow international institutional investors to access AAA-rated issuers requiring no credit risk capital charge (0% BIS weighted). Issuance of structured notes adds credit risk management complexity to debt management strategies of the Borrowers as mark-to-market levels of credit exposures change with movements of currency and interest rates and must be measured to assess accurate levels of credit exposures to counterparties.

• In Canada, according to our interviews, institutional investors typically avoid these products, deeming them too expensive compared to what they can achieve on their own – they definitely see these structures as more of a retail product. Concerns raised about retail targeted issues include: (1) do retail investors understand the role of the Borrower in the transaction; or (2) if investors receive no return from the issue, will the reputation of the Canada Credit suffer?

• Issues underlying all structured note issuance include:(1) do the Borrowers fully understand the issues, and can they reverse engineer the product?; (2) to translate the structured note into what the Borrower needs, complex swaps are executed with counterparties rated lower than the Borrowers; and (3) do the Borrowers appropriately price the structural and counterparty risk into their borrowing targets?

• In our review of a sample of structured notes issued by the Borrowers, we noted that the counterparty to the swaps or other other-the-counter derivatives hedging these structures is the official calculation agent. Whereas this is neither a wrong or unusual situation per se, it reinforces the fact that Borrowers should be able to reach their own independent valuations to ensure that they are treated fairly by their counterparty and that they properly value their market and credit risks on said structures. The Borrowers indicated that they have this capability.

• As many of the structures include a callable feature, they can exacerbate rollover risk hence market risk – that is in cases where debt will have to be rolled over at unusually high cost.^[3] The calls are usually hedged and if not the Borrower is not likely to pay more than its average cost rather than high cost. Call dates are usually fairly short.

• In their Guidelines for public debt management^[4], the IMF and Worldbank propose that

“Where appropriate, issuing instruments with embedded options (such as savings bonds, which are redeemable by the bondholder on demand) may also contribute to instrument diversification. However, even where valid reasons exist for issuing such securities, debt managers should exercise considerable caution to ensure that the risks inherent in embedded options and other derivative instruments are integrated in the risk management framework, and that the instruments and risks are well understood by the issuer and other market participants.”

Why Relevant?

• Canada Treasury Bills and Bonds are used as the benchmark against which all other borrowers in the Canadian fixed income capital markets are measured.

• Therefore the Government of Canada establishes benchmark issues, and continually is taking steps to maintain a viable and liquid yield curve.

Measures of Liquidity

• The narrowness of the bid - offer spread.

• Size of benchmark issues: the buybacks, switches and reopening of issues were very helpful in sustaining healthy benchmark sizes over the last few years. However, the Bank of Canada and other market observers agree that these programs have matured and that given the shrinking size of the overall debt combined with the transfer of a larger part of debt issuance into Treasury Bills, the minimum benchmark sizes could decrease somewhat over the next few years, posing a challenge in terms of liquidity maintenance.

• Trading volumes.

• Ability to transact substantial size trades with nominal market impact.

• Number of market participants: There were 30 dealers distributing GOC securities in 1997 and 20 as of October 2004. Three large US primary dealers departed the Canadian market in 2001. The concentration of the primary market is increasing – the five major primary dealers accounted for 57.4% of issues in 1999/2000 and for 68.1% in 2003/2004.

Observations from Interviews

• GOC bond program issuance peaked at $54B in 1996-1997 and has fallen since then to $35.5B in 2004-2005 – a reduction of roughly one-third over that period; the program is expected to fall further this year to $33B.

• A large portion of Canada’s liquidity is consumed by “buy and hold” investors who do not often trade their issues.

• About half of the Canadian dealers indicated they have no concerns about liquidity, the other half indicated that while liquidity is acceptable today, they are concerned about the future.

• Investors overall are more concerned about future liquidity than dealers, and those who transact in long-term Canada bonds tend to find that liquidity at the long-end is insufficient, and that it is difficult to easily trade large amounts at that point in the curve.

• Foreign dealers indicated that they saw sufficient liquidity for Canadian dealers and investors, but not for international dealers and investors.

• Foreign dealers and investors both expressed concerns about the concentration of power with the Canadian dealers.

• Interviewees indicated that Canadian and international bond demand is at an all-time high and growing.

• The only Borrower issues considered to have reasonable liquidity are the CMBs.

• Interviewees indicated that 5-year point on the yield curve tends to be the most desired in the markets, and GOC should not abandon that point on the yield curve for any reason.

• International dealers and investors indicated that GOC has an excellent world reputation, and that any additional supply could be easily absorbed by the market without an impact on price.

Financial Reporting

Why Relevant?

• Changing the status quo could change the amount of debt reported on the “Public Accounts of Canada” (Canada’s financial statements), and therefore could change various figures reported, such as the debt to GDP ratio and interest expense as a percentage of spending.

Accounting and Financial Reporting Policies

• GOC follows the Public Sector Accounting Board (“PSAB”) guidelines for financial reporting.

• Under these guidelines, all of the Borrowers, except CHT, are “government business enterprises” because they: (i) are separate legal entities; (2) carry on a business; (3) sell goods and services to individuals and organizations outside of the government; and (4) are self-sustaining in the normal course.

• The PSAB guidelines require that Government Business Enterprises be consolidated using the equity basis. GOC uses a modified equity basis, as the Borrowers typically use private sector accounting policies, and their equity is consolidated on that basis instead of being translated into equity on a PSAB basis.

• Thus, GOC presents each Borrower as an investment asset at its equity level, and does not include the debt issued by the Borrowers in the Public Accounts.

• Under PSAB guidelines for long-term debt, netting of long-term debt is by GOC only allowed if the terms and conditions of the debt between GOC and the Borrower mirrors that of the terms and conditions of the debt issued to the market by GOC.

• It is unlikely that any CFE would most effectively borrow by mirroring Borrower needs, and therefore netting should not be expected – leading to an increase in reported debt in this scenario.

• From an economic basis, nothing would change, however reported figures could change significantly, as shown below.

Observations on Interest Ratio

• Under a worst case centralization scenario, assuming that all existing Borrower debt was issued by GOC and that no netting was permitted, the reported interest ratio as at March 31, 2004 would have increased by about 1% from 18% to 19%.

• Excluding CHT, the impact would be reduced to about 0.5%, increasing the ratio to 18.5%.

• If any centralization scenario evolved, and such scenario did not involve netting, then it would likely be applied on a prospective basis as new debt is issued, such that this increase would occur over time.

Observations on Debt and Debt to GDP Ratio

• Under a worst case centralization scenario, assuming that all existing Borrower debt was issued by GOC and that no netting was permitted, the reported total market debt as at March 31, 2004 would have increased by 23% from $440 billion to $545 billion.

• Excluding CHT, the impact would be reduced significantly, increasing the total market debt by 11%.

• If any centralization scenario evolved, and such scenario did not involve netting, then it would likely be applied on a prospective basis, such that this increase would occur over time.

• Debt to GDP ratio would be unlikely to be affected as any additional debt would be offset by a financial asset (i.e. an amount due from the Borrower) and this ratio considers and deducts financial assets from gross debt.

Hedge Accounting Issue

• The new hedge accounting rules could lead to more volatility in Borrowers’ reported earnings. This impact should be the same whether the elected alternative is the status quo or one of the centralization models, as ALM related derivatives hedges would continue to be posted in Borrowers books.

• However, the amount of structured products being issued going forward could influence the size and complexity of the issue.

Why Relevant?

• The ability of Borrowers to manage their day to day liquidity requirements is critical to the accomplishment of their mandate.

• Changing the status quo could change the amount of short term liquidity that the Borrowers maintain.

• In a centralized model, it would be essential for the CFE to establish normal lead times that Borrowers would provide as forewarning of their expected borrowing needs. This is especially critical for money market activity.

Framework and Ranges

• Each Borrower has a policy in place which governs liquidity targets and limits.

• Predictability of cash flows: for some Borrowers, cash flows are fairly predictable, whereas for others, cash flows are very unpredictable as they are driven by several external factors (i.e. crop transportation delays, weather, large export transaction closing, etc.).

• Liquid assets (cash and marketable securities) are generally maintained at around 5% to 8% of total assets.

• Some Borrowers compare regularly their liquidity ratios with those of their peers, in either the private or sovereign, supra-national sectors.

• In some cases, Borrowers keep high levels of liquidity, with as much as 11% to 13% of their assets liquid, due to the unpredictable character of their cash flows and due to a desire to earn revenue from a liquidity portfolio.

Liquidity Sources

• All Borrowers (except CHT) have direct regular presence on the domestic commercial paper markets and, in most cases, in US markets and Euro CP markets.

• Each Borrower has Intraday and overnight credit lines in place with commercial banks.

Short Term Investments

• Short term liquidity is placed in investments allowed by policy in compliance with Finance Guidelines.

Arbitrage

• Keeping too much liquidity could be perceived as using the Canada Credit to obtain cheap resources which are then placed in higher yielding short term money market instruments.

• In theory, given efficient operations, (under any alternative chosen) decentralized pools should be reduced and “arbitrage” possibilities eliminated.

Liquidity Crisis Management

• Borrowers have diversified funding sources (geographic, institutional, retail, etc.) and keep more channels open.

• In crisis, Borrowers have noticed a flight to quality, generally implying that their borrowing requirements may still be readily met.

Why Relevant?

• The effectiveness of Borrowers in managing treasury and borrowing operations is critical to fulfill their mandates.

• Changing the status quo could add further complexity and increase operational risk.

Framework

• The Borrowers are autonomous, well-established as relatively stand-alone entities with their own boards.

• The Borrowers value treasury and capital markets operations as a core activity.

• Each of the Borrowers has fully operational Treasury department set-up, including front, middle and back-office.

• Some systems are the same (i.e. Bloomberg), but most are different between Borrowers.

Role of Treasury

• Borrowing, investing, cash management, asset/liability management, lending program support, investor relations, and liquidity management.

• To obtain funding in global markets in the most efficient and cost effective manner and to optimize the net interest income of the Borrowing entity that they serve.

• To various degrees, Borrowers have developed sophisticated financial engineering capabilities to manufacture structured notes or fund securitization issues.

• Active role in helping the borrowing entity set the design and pricing of its various products and services.

• Perform ALM recommend policies/procedures to Asset Liability Management Committee (ALCO) and report on ALM issues and compliance with risk management policies.

Observations from Interviews

• The Borrowers are extremely concerned that centralization would negatively impact their mandates in three major areas: (1) loss of flexibility; (2) loss of market intelligence; and (3) loss of autonomy

• The Borrowers feel that with funding handled by a CFE, treasury capabilities in the treasury department will become fragmented and inefficient;

• They also believe that the CFE will not be sufficiently responsive, thereby reducing the flexibility of the treasury department;

• Regarding autonomy, centralization is viewed as a forced outsourcing of a core activity, which reduces the ability to act as a relatively independent stand-alone entity; accordingly, the Borrowers believe that centralization would significantly impair their ability to support their respective mandates;

• Having their own Treasuries is viewed by the Borrowers as benefiting their core mandates, for example, through exchange of market intelligence and help in setting the price of services.

• Conversely, there is a perception that centralization could hurt the fulfillment of Borrowers’ mandates through loss of these benefits.

Mitigating Factors

• Under any of the envisioned centralized borrowing frameworks, each Borrower will need to retain its Treasury department expertise and practitioners to perform ALM and effect derivative hedges

• Many of the efficiency issues can be mitigated with a well planned CFE, with a tight service level agreement

• The CFE would likely add, not subtract treasury and capital markets expertise, thus increasing overall market intelligence for the whole group, provided that communications are set up properly among the CFE and Borrowers

• It could be argued that international capital markets intelligence could be of limited value for those Borrowers with predominantly domestic businesses

ALM and Derivatives

• Each Borrower has developed in-house asset liability management expertise.

• It is widely accepted that people performing ALM must understand very well the core business that they are funding/hedging.

• All Borrowers are currently preparing for the implementation of new derivative accounting rules (Accounting guideline 13).

Relationships

• Frequent informal relationships between Borrowers, but no formal exchange of services or information.

• Yearly submission of borrowing plans to Finance.

• Quarterly filing at the Bank of Canada of the counterparty exposures.

• Otherwise, (with exception of one Borrower whose borrowing ceilings are based on a formula computed every quarter) no other formal contacts or filings by Borrowers with either Finance or Bank of Canada, as long as they remain within limits authorized in the borrowing plan.

• There is, to a limited extent, some mobility of staff transferring from one Borrower to another.

Financial Risk Management

Why Relevant?

• Best practice guidelines of the World Bank for sovereign issuers invite debt managers to identify and manage the trade-offs between expected costs and risks in the government debt portfolio.

• Sound risk management by the public sector is essential for risk management by other sectors of the economy.

Approach and Organization

• Risks monitored and managed individually by each Borrower and reported to local ALCO.

• Borrowers have comprehensive risk management policies in place – please refer to table entitled “Financial Risk Management Practices” in Appendix B.

• No aggregate view of risks – other than counterparty credit risk.

• Borrowers indicated that they are opened to doing more risk reporting/would appreciate feedback.

• At the time of our interviews, there were 31 persons involved in risk management at the Borrowers.

Foreign Currency and Interest Rate Risk Management

• Risk limits are established to minimize the impact on interest incomes and economic value of the Borrowers

• Hedging strategies using derivatives are set to offset foreign currency and interest rate risks.

Permitted Derivatives Instruments and Strategies

• For some Borrowers, a list of authorized derivatives is mentioned in their Risk Management Policies; in the absence of such explicit list, the approval process for new derivatives strategies is documented.

• All Borrowers limit their use of derivatives to the types they are able to value, monitor and manage internally on a timely basis.

• Risk monitoring for derivatives activities is in place, with emphasis on counterparty/credit risk management.

Counterparty / Credit Risk Management

• For derivatives, the Borrowers deal only with highly-rated counterparties, in accordance with Finance guidelines.

• A regular monitoring of counterparty/credit risk is in place.

• Collateral requirements are applied when necessary.

• Borrowers policies provide for mandatory International Swaps and Derivatives Association (“ISDA”) Master Agreements with clauses allowing the winding down or recouponing of swaps in the event of a credit downgrade of the counterparty; further credit mitigation arrangements include, for each Borrower surveyed, the possibility of having Credit Support Annexes (to the ISDA Master Agreement), however, it is not clear whether these CSA’s are mandatory for each and every counterparty – if not, Finance Canada should clarify that CSA’s are mandatory.

• Counterparty exposures are reported by the Borrowers to the Financial Risk Office on a quarterly basis – however Borrowers indicated that they seldom get any feedback from such reports.

Structured Notes

• In order to achieve sub-LIBOR borrowing rates, mainly through the implicit premium tied to the embedded options of such products, some Borrowers are active issuers of structured notes to retail investors. Those notes are typically swapped into basic floating rate issues.

• All Borrowers issuing structured notes indicated that they are able to value the corresponding hedges independently either directly or by outsourcing to an independent outside firm.

• Borrowers issue structured notes which are capital guaranteed only; however, no formal guidelines or policies exist with respect to potential retail client suitability issues and reputation risk.

Why Relevant?

Minister of Finance, Finance Canada and the Bank of Canada are ultimately responsible for the Canada Credit, Government borrowing and investing operations, the smooth functioning of the Canadian capital markets, and prudent debt management (including asset/liability management) for GOC, among other things.

• Borrowers in the fulfillment of their mandates must also ensure their own prudent debt management and their own ALM, which could differ from the ALM done by Finance as they have essentially financial assets whereas the Government has a significant amount of non financial assets to fund.

• Borrowers operate corporately under the overall umbrella of the federal legislative framework, being mainly the Borrower’s individual enabling legislation (e.g.; National Housing Act, Export Development Act, etc.) and the Financial Administration Act.

• Governance and accountability are critical to the underlying success and stability of Canada’s capital market operations – a significant misstep by any Borrower can have repercussions on the Government and all other Borrowers.

Observations on Ministerial Control and Oversight

• The main formal means by which Minister of Finance and Finance Canada oversee Borrowers’ borrowing plans and performance is through the legislatively required annual Borrowing Plans approved by Minister of Finance.

• There is very limited homogeneity in the formats used by the various Borrowers to submit their borrowing plans, which makes aggregation and backward comparisons very arduous if not impossible.

• As the CHT is not subject to the FAA, the CMB program is not currently formally submitted in a borrowing plan to Finance Canada.

• Borrowing Plan approval is given by a letter from the Minister of Finance to the Minister responsible for the Borrower.

• Minister of Finance, Finance Canada and Treasury Board are active in the annual Corporate and Borrowing Plan reviews, policy setting, performance reviews, and developing and setting regulatory guidelines and their enforcement. There is currently little formal interaction between Finance Canada and Borrowers other than this annual planning and approval process, as long as the Borrowers remain within these authorized limits.

• In between these annual reviews, Finance Canada has access to the ALCO reports but is not part of the monthly or quarterly ALCO review; as a general practice, Finance Canada neither routinely reviews the quarterly ALCO reports nor analyzes each Borrower individually or as a consolidated group.

• Finance Canada currently relies on the Borrowers to comply with the terms of their approved borrowing plans and on the Office of the Auditor General to check compliance upon their external audits.

Observations on Board of Directors and Management’s Control and Oversight

• Borrowers’ Boards of Directors approve the Corporate Plan, which includes the Borrowing Plan.

• Borrowers’ Treasury management reports to corporate level ALCO per leading practices.

• However, further to our observation of monthly or quarterly ALCO reports, we concluded that in general, there is room for improvement to align their contents or the organization thereof with leading practices, improve clarity and facilitate aggregation for Finance Canada.

• Recent studies indicate prolonged vacancies and other issues at the Borrowers’ Board level, and in one case, at the CEO level, indicating need for improvement.

• Some Boards have stronger treasury and capital markets expertise than others, however according to the OAG, the situation is gradually improving as “we found fewer gaps in the collective skills and expertise of board members. We also found that the composition and operating practices of board audit committees had improved and that audit committees are operating more effectively than in 2000”.

• All Borrowers undergo annual external audits and are also subject, at least once every five years, to special examinations conducted by the Office of the Auditor General of Canada.

Observations on Borrowers’ Independence

• Balance needs to be made between independence to act quickly and decisively in an active, international capital markets environment on the one hand, and control and optimal deployment of the Canada Credit, on the other hand.

• Historical trend has been towards increasing independence as markets and Borrowers’ capabilities have grown.

Appendix J

Appendix K

Addenda

Addendum 1 - Glossary

Acronyms

Terms and Phrases
(Sources: www.investopedia.com, www.in-the-money.com).

Addendum 2 - Bibliography

Bibliography (cont.)

Bibliography (cont.)

Bibliography (cont'd)

Bibliography (cont'd)

Addendum 3

Listings of Organizations Interviewed

Unless otherwise noted, all interviews were conducted in person at the offices of the interviewee. A small number of interviews were held via teleconference.

In order to protect the privacy of the individuals involved in the interview process, we have not included their names herein.

Addendum 4

Interview Guide

Review of Borrowing Framework of Major Federal Government-Backed Entities

It should be noted that these interview guides were intended as a springboard for discussion of various topics. Accordingly, interviews typically expanded upon the themes outlined herein.

Part I - Introduction

Part II - Alternatives and International Models

Part III - Finance Canada/Bank of Canada

Part IV - Borrowers

Part V - Brokers/Investors

Part VI - Individual Borrower Questions

(This section deleted due to Borrower confidentiality.)

Notes

¹  Finance Canada, Review of the Government of Canada Debt Distribution Framework, October 2004, p. 4 [Return]

²  Finance Canada, Review of the Government of Canada Debt Distribution Framework, October 2004, p. 9. [Return]

³  Guidelines for Public Debt Management - Amendments December 2003, issued by the Staffs of the International Monetary Fund and the World Bank, p. 10. [Return]

⁴ Guidelines for Public Debt Management, issued by the Staffs of the International Monetary Fund and the World Bank, April 2001 60. [Return]

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