Determinants of bankruptcy protection duration for Canadian firms

The present thesis examines the determinants of the bankruptcy protection duration for Canadian firms. Using a sample of Canadian firms that filed for bankruptcy protection between the calendar years 1992 and 2009, we fmd that the firm age, the industry adjusted operating margin, the default spread, the industrial production growth rate or the interest rate are influential factors on determining the length of the protection period. Older firms tend to stay longer under protection from creditors. As older firms have more complicated structures and issues to settle, the risk of exiting soon the protection (the hazard rate) is small. We also find that firms that perform better than their benchmark as measured by the industry they belong to, tend to leave quickly the bankruptcy protection state. We conclude that the fate of relatively successful companies is determined faster. Moreover, we report that it takes less time to achieve a final solution to firms under bankrupt~y when the default spread is low or when the appetite for risk is high. Conversely, during periods of high default spreads and flight for quality, it takes longer time to resolve the bankruptcy issue. This last finding may suggest that troubled firms should place themselves under protection when spreads are low. However, this ignores the endogeneity issue: high default spread may cause and incidentally reflect higher bankruptcy rates in the economy. Indeed, we find that bankruptcy protection is longer during economic downturns. We explain this relation by the natural increase in default rate among firms (and individuals) during economically troubled times. Default spreads are usually larger during these harsh periods as investors become more risk averse since their wealth shrinks. Using a Log-logistic hazard model, we also fmd that firms that file under the Companies' Creditors Arrangement Act (CCAA) protection spend longer time restructuring than firms that filed under the Bankruptcy and Insolvency Act (BIA). As BIA is more statutory and less flexible, solutions can be reached faster by court orders.

Using a Bayesian model for bankruptcy prediction : a comparative approach

The purpose of this study is to examine the impact of the choice of cut-off points, sampling procedures, and the business cycle on the accuracy of bankruptcy prediction models. Misclassification can result in erroneous predictions leading to prohibitive costs to firms, investors and the economy. To test the impact of the choice of cut-off points and sampling procedures, three bankruptcy prediction models are assessed- Bayesian, Hazard and Mixed Logit. A salient feature of the study is that the analysis includes both parametric and nonparametric bankruptcy prediction models. A sample of firms from Lynn M. LoPucki Bankruptcy Research Database in the U. S. was used to evaluate the relative performance of the three models. The choice of a cut-off point and sampling procedures were found to affect the rankings of the various models. In general, the results indicate that the empirical cut-off point estimated from the training sample resulted in the lowest misclassification costs for all three models. Although the Hazard and Mixed Logit models resulted in lower costs of misclassification in the randomly selected samples, the Mixed Logit model did not perform as well across varying business-cycles. In general, the Hazard model has the highest predictive power. However, the higher predictive power of the Bayesian model, when the ratio of the cost of Type I errors to the cost of Type II errors is high, is relatively consistent across all sampling methods. Such an advantage of the Bayesian model may make it more attractive in the current economic environment. This study extends recent research comparing the performance of bankruptcy prediction models by identifying under what conditions a model performs better. It also allays a range of user groups, including auditors, shareholders, employees, suppliers, rating agencies, and creditors' concerns with respect to assessing failure risk.

Canadian Niagara Power Company fonds

Power at the Falls: The first recorded harnessing of Niagara Falls power was in 1759 by Daniel Joncairs. On the American side of the Falls he dug a small ditch and drew water to turn a wheel which powered a sawmill. In 1805 brothers Augustus and Peter Porter expanded on Joncairs idea. They bought the American Falls from New York State at public auction. Using Joncairs old site they built a gristmill and tannery which stayed in business for twenty years. The next attempt at using the Falls came in 1860 when construction of the hydraulic canal began by the Niagara Falls Hydraulic Power and Manufacturing Co. The canal was complete in 1861 and brought water from the Niagara river, above the falls, to the mills below. By 1881 the Niagara Falls Hydraulic Power and Manufacturing Co. had a small generating station which provided some electricity to the village of Niagara Falls and the Mills. This lasted only four years and then the company sold its assets at public auction due to bankruptcy. Jacob Schoellkopf arrived at the Falls in 1877 with the purchase of the hydraulic canal land and water and power rights. In 1879 Schoellkopf teamed up with Charles Brush (of Euclid Ohio) and powered Brush’s generator and carbon arc lights with the power from his water turbines, to illuminate the Falls electrically for the first time. The year 1895 marked the opening of the Adam No. 1 generating station on the American side. The station was the beginnings of modern electrical utility operations. The design and operations of the generating station came from worldwide competitions held by panels of experts. Some who were involved in the project include; George Westinghouse, J. Pierpont Morgan, Lord Kelvin and Nikoli Tesla. The plants were operated by the Niagara Falls Power Company until 1961, when the Robert Moses Plant began operation in Lewiston, NY. The Adams plants were demolished that same year and the site used as a sewage treatment plant. The Canadian side of the Falls began generating their own power on January 1, 1905. This power came from the William Birch Rankine Power Station located 500 yards above the Horseshoe Falls. This power station provided the village of Fort Erie with its first electricity in 1907, using its two 10,000 electrical horsepower generators. Today 11 generators produce 100,000 horsepower (75 megawatts) and operate as part of the Niagara Mohawk and Fortis Incorporated Power Group.

Letters to the Honourable John H. Dunn, 1837-1838

The recipient of the letters is John Henry Dunn who was born on St. Helena (a British territory island of volcanic origin located in the South Atlantic Ocean) in 1792 to John Charles Dunn and Elizabeth Bazette. He was married to Charlotte Roberts on May 4th, 1820 and they had 6 sons and 2 daughters. He came to Canada in 1820 in which year he became the Receiver General for Canada. He held this position until 1841.Charlotte died in 1835. In 1822 he was named to the Province’s Legislative Council. He was president of the Welland Canal Company from 1825-1833. In 1836 he was named to the executive council of Upper Canada but resigned 3 weeks later with fellow counselors when lieutenant governor Sir Francis Bond refused the advice of the council. Dunn was made the Receiver General for the newly formed Province of Canada in 1841, and was elected to represent Toronto in the legislative assembly that year. He married his second wife on March 9th, 1842. Her name was Sophie-Louise Juchereau Duchsnay. They had a son and a daughter. In 1843 he resigned, and was not re-elected in 1844. He returned to England with his family and died in London on April 21, 1854. Dunn was a supporter of the Welland Canal, St. Lawrence Canals and other public improvements. Between the passage of the Canada Trade Act and the Act of the Union he had tried to insure that projects received funding despite financial constraints. He claimed that he has saved Upper Canada from bankruptcy. His son, Alexander Roberts Dunn received the Victoria Cross for his role in the Charge of the Light Brigade at Balaclava. Dunn Street in Niagara Falls is named after John Henry Dunn. The town and township of Dunnville were also named for him. Sources: http://biographi.ca/009004-119.01-e.php?id_nbr=3889 http://www.niagarafrontier.com/cityfalls.html

Port Weller Dry Docks collection, 1959-1967

Port Weller Dry Docks Limited was officially established on April 25, 1946, near Lock 1 of the Welland Canal. Charles A. Ansell was the company’s first President and General Manager. Initially, the company focused on repairing ships, but in June, 1951, built their first ship, the Scott Misener. In 1956, the Upper Lakes and St. Lawrence Transportation Co. purchased all of the shares of Port Weller Dry Docks Limited. In the mid-eighties, ULS (Upper Lakes Shipping) International (which owned the Port Weller dry docks), and Canada Steamship Lines, merged their operations. As a result, the Port Weller Dry Docks became a division of this newly formed company, known as Canadian Shipbuilding and Engineering Limited. In 2007, Seaway Marine & Industrial Inc. took over ownership of the Port Weller Dry Docks, but declared bankruptcy in July 2013.

Stelco records, 1951-1989

The Steel Company of Canada (Stelco) was formed in 1910 with the incorporation of the Canada Screw Co. Ltd., the Montreal Rolling Mills Co., the Dominion Wire Manufacturing Co. Ltd., the Hamilton Steel and Iron Co. Ltd., and the Canada Bolt and Nut Co. Ltd. By the 1920s, the company was the largest producer of steel ingots in Canada. The 1930s saw continued success and expansion of the company as Stelco increased its iron and steel capacity by 50 percent. The company continued to prosper throughout the next several decades, with sales revenues exceeding one billion dollars in 1974. In 1980, the company officially changed its name to Stelco, in order to simplify its name in both the French and English language. The company began to experience financial difficulties beginning with the recession in 1982. The troubles persisted for the next 25 years as a result of a decreased demand for steel, labour disputes, and high steel imports. In 2004, Stelco entered bankruptcy protection. By 2007, Stelco had lost $240 million in its first four quarters after emerging from bankruptcy protection. That same year Stelco was purchased by the United States Steel Corp. Despite efforts to restructure the company, bankruptcy was again declared in 2014.