Canadian bank earnings growth seen at risk as mortgage deferrals almost double the U.S. rate

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Analyst says bank earnings unlikely to return to 2019 levels until 2023

TORONTO — Canada’s top six banks have deferred mortgage repayments at nearly double the rate of their U.S. counterparts, setting themselves up for a tough slog to return to their pre-pandemic performance as higher household debt and insolvencies weigh on borrowing.

“There’s going to be limited earnings growth coming through, if any” until employment returns to about 80 per cent to 90 per cent of pre-coronavirus levels, said Sadiq Adatia, chief investment officer at Sun Life Global Investments. U.S. mortgage deferrals stood at 8.5 per cent as of May 24, according to Mortgage Bankers’ Association data, in part due to higher government unemployment benefits and additional stimulus payments regardless of employment status.

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Justin thinks Canada has the world reserve currency. This is going to end so badly. Idiot!

Go figure... after protests on oil shut down the country it was already really bad

Or .. as usual... Canadians are cheap and have used the deferral option to manage short term cash flow.

Pfft... The banks always win. They are even bigger than government.

So the billions they make every quarter are gone?

The Trudeau mismanagement of COVID is to blame for this. Always a day late to the parade.

Oh no! The poor banks, feel so bad for them. 🖕🏼

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