Overall this quarter, banks saw delinquencies rise for credit card loans, followed by personal loans and lines of credit, then mortgages.
Canada’s largest banks continue to set aside more money to cover bad loans as Canadians grapple with rising unemployment and elevated interest rates.
The Big Six banks, which reported quarterly financial results over the past week, said that rising insolvencies in Canadian retail banking and losses from the U.S. office market are hurting their bottom line.
Together, the lenders recorded $4.3 billion in provisions for credit losses (PCLs) in the second quarter, an increase from the $4.1 billion in the first quarter. These reserves, which reflect the health of the Canadian consumer, have been growing since the pandemic, while some analysts believe they will peak in the second half of the year.
“The consumer is getting pressured now,” said Carl De Souza, senior vice-president of North American financial institution ratings at Morningstar DBRS. “Particularly as their debts reprice at higher interest rates, and they get payment shocks.”
Bu hikaye Toronto Star dergisinin May 31, 2024 sayısından alınmıştır.
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Bu hikaye Toronto Star dergisinin May 31, 2024 sayısından alınmıştır.
Subscribe to Magzter GOLD to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
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