TORONTO, April 1, 2013 /CNW/ - AGF Investments Inc. today announced that it will be temporarily capping all purchases and switches into the AGF Monthly High Income Class, as of April 2. The move is in response to the March 21 federal budget regarding the use of forward contracts for the purposes of converting income returns to capital gains. AGF is pursuing this temporary course of action in order to protect the integrity of the All World Tax Advantage Group (AWTAG) and act in the best interest of existing shareholders of the corporation.
"We have undertaken this temporary measure in order to protect the interests of our investors," said Gordon Forrester, Executive Vice-President, Marketing and Product, Head of Retail. "Until we receive clarification on these new regulations, we believe the prudent move for us is to protect existing shareholders from any potential uncertainty."
The federal budget announced that returns on Yield Class funds earned from the reference funds via forward contracts would be treated as ordinary income rather than capital gains. In order to limit the exposure to risk, this cap on the AGF Monthly High Income Class will remain in effect while AGF works with the government and regulators to understand the full implications of the change. As of the end of February 2013, AGF's AUM in AGF Monthly High Income Class was $22 million.
About AGF Management LimitedAGF Management Limited is one of Canada's premier independent investment management firms with offices across Canada and subsidiaries around the world. AGF's products include a diversified family of award-winning mutual funds, mutual fund wrap programs and pooled funds. AGF also manages assets on behalf of institutional investors including pension plans, foundations and endowments as well as for private clients. With over $39 billion in total assets under management, AGF serves more than one million investors. AGF trades on the Toronto Stock Exchange under the symbol AGF.B. Caution Regarding Forward-Looking Statements This release includes forward-looking statements. Forward-looking statements include statements that are predictive in nature, depend upon or refer to future events or conditions, or include words such as 'expects,' 'anticipates,' 'intends,' 'plans,' 'believes' or negative versions thereof and similar expressions, or future or conditional verbs such as 'may,' 'will,' 'should,' 'would' and 'could.' Forward-looking statements are based on certain factors and assumptions, including expected growth, results of operations, economic factors, business prospects, business performance and opportunities. While the company considers these factors and assumptions to be reasonable based on information currently available, they may prove to be incorrect. Forward-looking statements are not guarantees of future performance, and actual events and results could differ materially from those expressed or implied by forward-looking statements due to, but not limited to, important risk factors such as level of assets under management, volume of sales and redemptions of investment products, performance of investment funds and of investment managers and advisors, competitive fee levels for investment management products and administration, and competitive dealer compensation levels and cost efficiency in our investment management operations, as well as interest and foreign-exchange rates, taxation, changes in government regulations, unexpected judicial or regulatory proceedings, and the company's ability to complete strategic transactions and integrate acquisitions. The company cautions that the foregoing list is not exhaustive. The reader is cautioned to consider these and other factors carefully and not place undue reliance on forward-looking statements. Forward-looking statements are given only as at the date of this release and other than specifically required by applicable laws, the company is under no obligation (and expressly disclaims any such obligation) to update or alter the forward-looking statements, whether as a result of new information, future events or otherwise. Additional risks and uncertainties can be found in our MD&A for the fiscal year ended November 30, 2012 under the headings "Caution Regarding Forward-Looking Statements" and "Risk Factors and Management of Risk" and in our other filings with Canadian securities regulatory authorities. SOURCE AGF Management Limited