Canadian Industrial Outlook: Banking—Winter 2017

The Conference Board of Canada, 14 pages, March 17, 2017
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This report examines the short-and medium-term economic and profitability outlook for Canada’s banking industry.

Document Highlights

  • Interest Rates—With interest rates at historical lows, the banking services industry has struggled to increase its interest revenues in recent years. Canadian banks have had to tap into other sources of income, including banking fees and investment management services, to generate revenue growth.
  • Household Credit—With the housing market expected to cool and interest rates set to start rising again in 2018, growth in mortgage and non-mortgage debt will continue to ease. In fact, the days of consumer credit growth outpacing growth in disposable income are likely behind us.
  • Business Lending—Chartered bank loans issued to the private sector have posted their longest expansion on record—24 consecutive quarters of growth since the 2009 recession. However, the double-digit increases seen through 2016 are clearly unsustainable, and we expect to see a slowdown in private sector lending growth.

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