|
Council still owes citizens full ABCP facts |
|
|
|
Written by Robert Babki
|
|
Wednesday, February 18 2009, 12:19 PM |
City council voted to “receive and file” the ABCP financial update report from administration recently without a single question from council members.
Mayor Tarleck gave his usual “all is well” opinion, and Ald. Dodic reminded us opinions are not useful, nor is hindsight. Both confirm our $30.3-million investment is not producing a happy return, blaming the economy.
No one knows what we will get in 2017, but at the very least, this council owes us some facts to consider the actions this council has taken.
Today (Feb. 11) the floating rate will give us a return of .5007 per cent, and that is only on part of the notes. Council still refuses to disclose the original terms of investments council traded for the present notes that mature in 2017 and pay less than one per cent. Secure provincial bonds can be had with maturity dates in 2017 yielding more than four per cent today.
This council chose (in total secrecy) to forego all legal rights it may have had against the investment banker and trade fixed return notes for highly speculative unsecured floating interest rate notes, and they now blame the economy and ignore the fact the investments probably were not allowed under our investment policy.
Hogwash; contracting for a floating rate of return on long terms is the most speculative investment you can make, and this council chose to do so in private. Comparing the present note returns to current short-term returns listed in the paper is a farce — current rates for solid provincial bonds maturing in 2017 are over four per cent.
Our annual losses of income will likely be more than $1.2 million per annum (exact figures unavailable only because council refuses to divulge the original contract terms, and the terms of investments cashed in to cover the frozen assets).
By refusing, are they protecting themselves, or National Bank? Limited disclosure was withheld for a year, and disclosed only because an annual report had to go to Edmonton, despite the fact the public money belongs to the citizens of Lethbridge, no one else.
Council owes nothing to National Bank, but does owe us at least the disclosure of facts. Meanwhile, we get no facts, and National Bank continues to act for the city in dealing with its investment portfolio of about $150 million — and likely earning income of well over $1 million per year.
Someone should be resigning. If only accountability was practised in Lethbridge.
|
