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【出版时间及名称】：惠誉评级-Canadian 1H10 Results and Midyear Outlook-100701
【作者】：fitch ratings
【文件格式】：pdf
【页数】：19
【目录或简介】：
Canada’s banks have weathered the global financial crisis better than most financial
institutions globally. During the worst of the financial crisis in 2009, the Big Six were
able to remain profitable. The strength and resilience of Canadian banks is evidenced
by the fact that they did not resort to or need public bailouts and official liquidity
support was relatively limited compared to other G7 countries. A number of reasons
could explain why Canadian banks fared better than most of their global peers: solid
capital and liquidity levels; conservative overall risk management practices partly
associated with a relatively concentrated market structure that allows close and clear
regulatory supervision; a relatively stable housing market; and the diversification
derived from the banks’ universal model.
The Canadian banks’ comparatively stronger profitability and performance on a global
basis has continued so far in 2010, helped by solid increases in residential housing and
consumer lending coupled with reduced provision expenses. Additionally, Canadian
banks’ performance came against a backdrop of rapid economic expansion.
Consumer spending and housing demand have been key drivers of Canada’s growth.
Likewise, revenue generation and performance for Canadian banks in 1H10 was driven
by solid growth in personal loans to support spending on goods and services and
increased residential mortgage lending as housing demand remained strong. The
increase in consumer spending was supported by household income growth, an
improving unemployment picture, and persistently low interest rates.
In addition to exceptionally low interest rates during 1H10, advances in residential
mortgage borrowings were spurred by a renovation tax credit that ended on Feb. 1,
2010. The Canadian mortgage market held up fairly well during the worst of the
recession and remained hot during the first half of 2010 with housing prices maintaining
a rising trend. Several factors could help explain why the housing crisis didn’t spill over
into Canada from the U.S. In Canada, mortgages with a loan-to-value ratio over 80%
must carry insurance from the Canada Mortgage and Housing Corporation (CMHC), a
federal agency, or a select group of approved providers. There was never a meaningful
subprime market and the banks’ origination of nonprime mortgages essentially ended in
2008 when CMHC ceased insuring such mortgages. Furthermore, banks hold the vast
majority of the mortgages they originate, which could have an impact on underwriting
standards. Finally, mortgage interest payments are not tax deductible, which may limit
the nominal size and certain incentives of residential borrowings. Still, the continued
growth in residential loans should be monitored carefully, particularly if house price
increases outpace household income growth during a sustained period of time.
While asset growth supported net interest income, non-interest income benefited from
enhanced income in wealth management due to market-related increase in fee revenue
and elevated transaction volumes. Improved year-over-year market conditions
benefited revenue from capital markets operations. While performance was particularly
strong in 1Q10, weaknesses in the Eurozone put a damper on global financial markets
activities in 2Q10.
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