Taxes are going up, TO condo prices are going down and recreational property up 15% to 40% in the Canadian market.

Canadian real estate and government, March 29

The latest Canadian real estate and government news. Risk of collapse, end of QE and rate rise are some of the issues discussed. Also the governments poor foreign policies on Ukraine are covered.
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FIRE report January 12th

Indigenous banking part 2 a continuation of earlier discussion of First Nations Bank. Other news:-Inflation-M&A under scrutiny-RBC has eyes on Europe
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BOC and reconciliation with Indigenous people

The Bank of Canada and other central banks, in conjunction with indigenous leaders want reconciliation and better economic outcomes for individuals. This video explores what is happening, gives the back story and sets the stage for a more in-depth analysis.
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Nov 26 FIRE report

Inflation and tariffs hit Trudeau in the face. Oil route as new strain goes viral. BNPL benefits questioned and investors open their wallets to receive dividends.
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FSIM FIRE report Nov 23

Duobank/Fairstone merger & Amozon boycott of Visa along with recent banking, insurance and real estate news from Canada.
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Nov 18th FIRE report

The latest financial news from the financial services industry monitor. Insurance companies should know that in 1990 BC flooding devastated the same flood plains as today. This report features coverage of insane inflation, interest rates hikes and the ongoing real estate melt-up.
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Poloz debunked, Nov 12 FIRE report

Poloz is wrong about inflation, university pension funds are out of their league, Home Capital run away, real estate wars and more from the financial services industry monitor.
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Central bank digital currencies: foundational prin

Central bank digital currencies: foundational principles and core features
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Nov 5th FIRE report

Topics todayDividends are backHigher interest rates are comingCOP26: Central bankers making miners richTO real estate melt-up
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FIRE report November 2nd

The latest Canadian FIRE news covering inflation risk and opportunities, Canadian Western bank expansion, governance and stablecoins.
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Canadian real estate February 24

Recap of recent real estate news in Canada. Tiff Macklem and market exuberance, cottage country price appreciation and the rise of lumber prices.
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Real estate: Feb 9, bulls vs bears

Bulls versus the bears, this week in the Canadian real estate industry.
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Feb 1, The Dumb Money Real Estate Vid

We a living a ponzi real estate market and the economy is at risk. Yet Doug Porter, economist BMO, is on record as saying Candian\'s want to pay more for houses. Yes, you can\'t make this stuff up. This video discusses the issues related to Porter\'s statement and explains why he is wrong.
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January real estate report 2021

2020 was a record year, except for condos. Montreal REM sites the exception to this rule. This video shares insights regarding the Canadian real estate segment.
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December 4th real estate report

Taxes are going up, TO condo prices are going down and recreational property up 15% to 40% in the Canadian market.
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Real estate, mortgage debt to income ratio improve

The mortgage debt to income ratio declined despite the pandemic. In this issue I discuss real estate stalling and immigration's impact on home prices.
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Real estate: fiscal conservatism/ponzi neoliberali

This video is intended to give viewers an understanding of the economic ideas behind Canada's potential housing bubble. This video also explains why Siddal, President and CEO of the CMHC, was likely pushed from his post.
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Caution for real estate investors, Oct 14th report

October 14th real estate report describing the issues in the market the last two weeks.
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Canadian bank industry overview - part 1

Overview of Canadian banking industry. This multi-part series looks at issues facing Canadian banks from a variety of angles. Part 1 examines the types of banks and scale using ROE and EBITDA as measures.
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Why insurance should partner with flood-claim.com

'Pros on the Go', a Fierce Tartan company are seeking insurance partners to pilot its new solution for streamlining the claims process.
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Canadian large bank comparison

Using financial data, Mark Sibthorpe compares the performance of TD bank to its rivals. TD grew faster in 2017 than its rivals, but was cited for aggressive sales practices.
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Current state of fintech in Canada

Mr. Michael R. King, Tangerine Chair in Finance and Co-Director, Scotiabank Digital Banking Lab / Ivey Business School at Western University
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XE.com explains their Big Data and AI strategy.

This video covers XE.com's presentation at the AI, Big Data and Analytics event which took place in Toronto February 7/8, 2018. Cecelia Tamez and Jean Louis provide insights into their evolution and winning strategy.
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Greenpeace urges TD bank boycott

Greenpeace's campaign to stop TD financing the oil sands is delusional. Trillions of dollars are at stake for the banks and the Canadian economy. This video explores the related financial issues.
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Insurance flood US vs Can comparison.

This video provides an overview of the main differences between Canada's approach to overland flooding versus the US approach.
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Canadian bank industry overview part 5

Canadian bank overview part 5, medium-large banks. Banks include Manulife, Tangerine and Laurentian Bank.
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Canadian banking industry overview part 4

Canadian banking industry overview of Canadian Tire Bank, Presidents Choice Financial, Equitable Bank, B2B Bank
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Part 3 Canadian bank industry overview

Overview of small-medium size banks in Canada. Banks covered include Versabank, Hollis Bank, Equity Bank and Caisse Populaire Acadienne.
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Canadian banking overview - part 2

Review of small banks including Bridgewater,Vancity Bank, Concentra, Wealth One, Zag...
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Death to bitcoin, long live bitcoin

Jamie Dimon calls bitcoin a fraud used by criminals, yet he has jumped into the blockchain with both feet.
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RBC to integrate Wave Technologies

RBC invested $24 million into Wave Technologies and now they will roll out Waves accounting, invoicing, reporting and billing platform to SMEs.
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Deposits have skyrocketed since the start of the p

Canadian banks have increased their deposits by $127 billion since the start of the pandemic. This video uses charts to show which banks gained the most and how.
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About

About BankNews TV: financial services industry monitor (FSIM), analytics and research

Latest news and events for Canadian financial service companies, analytics, fintech and AI. BankNews.TV provide the latest technology news and reports for banks and insurance companies looking to compete in a rapidly changing market.

Analytical information and financial information related to technogies that can change your business.

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Research

abcd

Real estate report: October 30th, 2020  

fsim.ca/docs/Oct30rereportv1.pdf

Mark Sibthorpe

The big buzz in real estate recently is Mark Carney being scooped up by Brookfield. This means more juice for riskier borrowers. Brookfield, a huge player in real estate, both residential and commercial, recently bought its remaining shares from Sagen (Genworth MI Canada), which values the company at $3.8 bn.


VersaBank’s New High-Security VPN Proving Especially Valuable During COVID-19 Pandemic  

fsim.ca/docs/TailscaleReleaseMarch30FINAL.pdf

Press Release

VersaBank (TSX:VB) (“VB” or the “Bank”) today announced the implementation of its new high security Virtual Private Network (VPN) remote access software solution, developed in partnership with Tailscale, a leading provider of secure network connectivity solutions. The software enables VersaBank employees to securely and directly connect to all the Bank’s servers across multiple offices and cloud providers, using two factor authentication and with every connection encrypted. The Tailscale-based solution uses the Office 365 setup and Windows client/server applications that the Bank already had in place.


2014 FSIM when Bernanke visited Montreal  

fsim.ca/docs/MockBernanke.pdf

Mark Sibthorpe

Considering Bernanke is hated by the Republicans and hated even more by the Democrats, and is currently under scrutiny for saving AIG but not Lehman, (in hindsight) with respect to issues over solvency vs liquidity, the Montreal lovefest attended by 1,100 people yesterday must have been a welcome respite. Click the link to read the entire 2014 report.


Eisman's big Canadian bank short  

fsim.ca/docs/eisman2.pdf

Mark Sibthorpe

I have been reporting on Steve Eisman's short position for quite some time.  As the analyst reaction to Eisman shows (link below), Eisman has taken a lot of heat for shorting Canadian banks. Instead of capitulating, in September 2019 he publicly disclosed the fact that he added Canadian Tire to his position, He explains the rationale for this in a BNN interview late 2019. Essentially, his big concern with respect to banks was non-performing loans in Alberta. He feels Canadian bank CEOs are not prepared for a credit cycle. He specifically referenced ATB (a private bank) in discussing his concerns. Looking at the numbers today, my guess is that he has made off like a bandit.


VersaBank Beta-Testing Its New, High Volume Mortgage Finance App   

fsim.ca/docs/VBCortelMortFinanceAppFeb62020.pdf

Press Release

VersaBank announces it is initiating beta-testing on its newly developed high-volume mortgage software app with the Cortel Group, one of Canada’s largest home and condominium builders. The app, named “Direct Connect”, was designed to facilitate and significantly reduce the lengthy finance approval process typically experienced by home buyers when visiting home and condo pre-construction sales offices.


How and why you need to defend your brand against disruptors  

Mark Sibthorpe

Technology, and being open to opportunities, has preempted transformation in banking. At the top of change are Mint, PayPal and ApplePay; three examples of transformative solutions that are now ubiquitous. On the horizon: Uber and Google, both having recently announced partner based banking services. Further down in the plumbing is Duca Impact Labs, Versabank, and Revolut. This report shows how cost conscious FIs can, not only stay relevant in the face of adversity, but punch well above their weight. All thanks to creative thinking and the ongoing commoditization of technology.


Kick the can(nomics)  

fsim.ca/docs/Kick.pdf

Mark Sibthorpe

Canada has used consumer debt to provide life support to the economy. This strategy which basically pushed the day of reckoning to the next government was old back in 2014, and now is well past its sell-by-date. Recognizing this, and desperate to keep the economy out of a recession, Trudeau is spending more money now than any government in Canadian history. This report disusses a possible alternative.


ScoreCard Bill Morneau, Canada's Minister of Finance  

fsim.ca/docs/ScoreCardMorneau.pdf

Mark Sibthorpe

This report is a scorecard I designed in order to rank the performance of the current Minister of Finance, Bill Morneau. I do regular rankings because, otherwise, I cannot measure the performance in a meaningful way. The scoring is based on a variety of metrics as detailed on the ‘score-table’ on page 3. Examples of the criteria and weighting include:

 


Observations and overview of 2018 NB flood support from government and insurance companies.  

fsim.ca/docs/Observations and overview of 2018 NB flood support from government and insurance companies..pdf

Mark Sibthorpe

 


Flood aftermath is linked to post traumatic stress. Here are some findings from a study conducted by Queensland University following a flood:

"The findings showed that aftermath stress contributed to poor mental health outcomes over and above the flood itself, prior mental health issues and demographic factors," Ms Dixon said.

 

"Aftermath stress was the strongest predictor of post-traumatic stress symptoms with 75 per cent of people saying the most difficult aspect was the aftermath and dealing with insurance companies," she said.

 

With this in mind, I felt it was important to understand how New Brunswick flood victims were treated.

 


Update Argentina: a sign of the times  

fsim.ca/docs/Update Argentina_ a sign of the times.pdf

Mark Sibthorpe

Argentina is in the news daily because the situation is dire, and may be an indication of further contagion. The most dramatic story that speaks of the a leading cause of its troubles was the recent arrest of the public works secretary, Jose Lopez. June 15th he was caught hiding millions in cash in a monastery. No this is not a plot for a comedy.


Summary of Canada's flood news, 2017 to present  

fsim.ca/docs/Summary-of-flood-news-2017-present.pdf

Mark Sibthorpe

This report covers flood news in Canada from 2017 to present and highlights the relevent issues for home-owners and the insurance industry.


Banking on Pot  

fsim.ca/docs/c10191_banking-on-pot.pdf

SBS

As states across the US legalize marijuana for both medicinal and recreational purposes, it has fueled a growing industry of marijuana related businesses (MRBs).


Canadian banking industry overview  

Mark Sibthorpe

The industry overview is divided into 5 parts:

Introduction
Small banks
Small medium sized banks
Medium sized banks
Medium large banks


2014 Mobile payments the Apple pay way  

fsim.ca/docs/Mobile_Payments_Apple_Pay_2014.pdf

Mark Sibthorpe

With Walmart Pay about to userp Apple Pay, I thought I would share my 2014 book on mobile payments and loyalty. The guilde was written for Merchants that want to understand loyalty, credit, mobile payments and Apple Pay, but anyone involved with credit and loyalty might find it useful.
The book is a prelude to Walmart leaving MCX, and chronicles the evolution that led to Walmart Pay. There is an extensive case study of Walmart that looks into its efforts to become an ILC and to avoid paying credit card transaction fees ('merchant discount').
It offers readers a step-by-step methodology for evaluating and transforming credit and loyalty programs. The strategies are based on proven examples and industry facts. The Nectar, Target, Canadian Tire and Walmart case studies are examples of the practical approach I have taken, written with the intent that merchants can use them as blueprints for their own initiatives. 


Death to bitcoin, long live the blockchain   (See full report)

Mark Sibthorpe

Jamie Dimon calls bitcoin a fraud used by criminals, yet he has jumped into the blockchain with both feet.


TD bank industry conduct  

fsim.ca/docs/tdind2.pdf

Mark Sibthorpe

TD’s share price recently collapsed by $7 bn in one day due to CBC’s allegations of aggressive selling tactics. A huge fall from a bank that was trading at a premium as recently as January. This was even before the most recent allegation of TD attempting to avoid paying taxes on advertising.
This report chronicles the events leading up to the collapse, shows TD's performance, analyses other related issues.


Book review: Back from the Brink  

fsim.ca/docs/backbrink.pdf

Mark Sibthorpe

This is a book review of the book Back from the Brink by Paul Halpern, Caroline Cakebread, Christopher C. Nicholls and Poonam Puri.


Footnote 151  

fsim.ca/docs/footnote151.pdf

Mark Sibthorpe

Footnote 151 implies an important regulatory change related to derivative contracts. It means that US Banks will not be required to hold as much capital against commodities. If you want to understand the implications of this regulatory change in more detail, see the enclosed related article detailing the changes. For contextual purposes, I have also included two Rolling Stones Magazines reports from 2010 and 2014 that chronicle the role large US banks have played in manipulating commodities. You might question the credibility of these sources, but rest assured, these reports are based on United States Senate hearings which outline the issues in a 396 page report related to the implied risks. 


Save the Canadian economy now  

fsim.ca/docs/helecopter-money.pdf

Mark Sibthorpe

Consumer debt spending appears to have insulated Canada from the worst of the credit crisis, but now the alarming magnitude of consumer debt ($1.92-trillion) could exacerbate a day of reckoning.
This report assesses the issues at hand and recommends the solution to get Canada's economy on track.


Reasons financial service companies should consider gamification  

fsim.ca/docs/GamingEventProposal-printsample--en-final.pdf

Mark Sibthorpe

Gamification of business processes resulted on Mint.com growing to 10 million users within 4 years. This report explains how.


National Bank Special Report  

fsim.ca/docs/NatBSpec.pdf

Mark Sibthorpe

According to Bloomberg, National Bank of Canada will take a C$64 million ($48 million) restructuring charge in the fourth quarter and said its investment in Maple Financial Group Inc., which is being probed by German regulators, may be at risk of a “substantial loss.”


Will Canadian banks charge companies for deposits?  

fsim.ca/docs/depgrowthimpact2.pdf

Mark Sibthorpe

In light of today’s possible rate cut, this report discusses how a bank rate cut and capital ratio pressure could precipitate negative corporate deposit interest rates in Canada.


Canadian Tire's (CTC) - Canadian Tire Financial Services (CTFS) Scotia deal overview and risk assess  

fsim.ca/docs/ctfsfinal.pdf

Mark Sibthorpe

Review of the Canadian Tire Financial Services deal with Scotiabank, risks, opportunity and benefits.


Finance minisiter scorecard August 26, 2015  

fsim.ca/docs/Scorejo-August-2015.pdf

Mark Sibthorpe

This report looks at Joe Oliver, minister of finance’s progress to date, and assigns a grade to his government’s performance to date.


Xtreme Branch  

fsim.ca/docs/xbranch.pdf

Mark Sibthorpe

Branches are evolving to meet the digital age. This documents tracks the evolution with real-world examples.


Canadian Nudge  

fsim.ca/docs/nudge.pdf

Mark Sibthorpe

Whether he knew it or not, Tom Reid, a senior vice-president at Sun Life, made a case for the behavior modification concept ‘Nudging’ when he recently proposed auto-enrolling Canadians in his company’s pension plans. Sun life cover 1.2 million Canadians, about 60% of the eligible employees.
According to Reid,


CWB cause for concern  

fsim.ca/docs/cwbupdate.pdf

Mark Sibthorpe

In an earlier report BankNews.TV expressed concerns about CWB. Here are 5 charts that show cause:
1. First earnings drop in years;
2. Deposits dropping which will increase cost of funds in the future.


BNTV Overview  

fsim.ca/docs/overviewpdf.pdf

BNTV

BankNews.TV Publishing Corp services overview document:

  • Analytics
  • Financial services industry monitor (FSIM) industry briefings and developments reports
  • Research


Challenger banks not a threat to big banks  

fsim.ca/docs/challenger.pdf

Mark Sibthorpe

This report looks at Canadian challenger banks (apart from merchant led banks) and explains why they have not threatened larger institutions. It also looks at ways in which these upstarts have achieved success.


Gamification of financial data project  

fsim.ca/docs/GamingEventProposal-printsample--en-final_original.pdf

Mark Sibthorpe

This document contains details on how BankNews.TV is helping kids learn programming via gamification of financial data.


The impact a rate rise will have for Canadian banks  

fsim.ca/docs/irr-f.pdf

Mark Sibthorpe

Canadian banks have made money throughout the credit crisis, but this trend may be about to reverse. The rational supporting this prediction is that revenue has grown despite a declining net interest margin (NIM). It has grown in spite of this fact because Canadian debt (loan lease volume) has risen significantly, as shown in chart 2.

This report looks at the issues facing Canadian banks in the event of a Bank Rate rise.  


FIFA: the new goldenballs  

fsim.ca/docs/goldenballs.pdf

Mark Sibthorpe

Yesterday, the Attorney General of Switzerland (OAG) opened criminal proceedings related to the FIFA scandal. This report outlines some of the events related to the criminal investigation, with a particular focus on banking.


Scorecard Minister of Finance: JIm Flaherty  

fsim.ca/docs/Scorecard Min Fin Flaherty April 8 2014.pdf

Mark Sibthorpe

March 18, Finance Minister Jim Flaherty resigned from cabinet after having endured a difficult year due to health issues. This report looks at his legacy and attempts to grade his government’s performance to date.


Sample RFP for a Loyalty Program  

fsim.ca/docs/sample RFP for a loyalty program.pdf

Mark Sibthorpe


Merchants extend financial services  

fsim.ca/docs/merchantfs.pdf

Mark Sibthorpe

Merchant led financial services are growing in importance once again. This is exemplified in the ongoing UK rivalry between ASDA, Sainsbury and Tesco. Together these merchant/financial service companies provide the backstop for three different approaches for merchants looking to extend their financial services.


Hot Money: real-estate  

fsim.ca/docs/hotmoney.pdf

Mark Sibthorpe

Canadian and London real estate, like Macau, may also be a convenient means for China’s elite to move money offshore; with the deleterious effect of driving up home values. Louise Shelley`s research concurs. In a published paper written for the National Defense University, Shelley argues that money laundering in real estate (MLRE) increases prices.


Currency Cheat Sheet: a guide for the rest of us  

fsim.ca/docs/currencycheatsheet.pdf

Mark Sibthorpe

Readers of this document will be presented with monetary policy issues and facts
that show the USD will likely remain the dominant reserve currency, despite
questionable Chinese practices, record US debt levels, and a shaky economy.


Riches to Rags? Summary of possible risks for Genworth MI CANADA, INC.  

fsim.ca/docs/gq4risk.pdf

Mark Sibthorpe

Genworth had its Q4 2014 earnings call. Genworth own about 30% of the mortgage default insurance in Canada. Not surprisingly, the earnings call became focussed on Alberta; and for good reason, with 20% of its outstanding insured mortgage balance in Alberta, sensitivity to the oil shock and how Genworth plan to manage related risks were discussed in detail.


Canadian Western Bank Competitive Forecast  

fsim.ca/docs/cwbf.pdf

Mark Sibthorpe

Based on historical financial data (see detailed charts pages 5-8), the oil based recession in Alberta, and comparison against two of its peers, this document outlines my observation with respect to CWB’s future performances.


Liquid Canada: the tipping point  

fsim.ca/docs/Liquid.pdf

Mark Sibthorpe

This report examines liquidity issues in the Canadian financial service industry.


Bank Fees  

fsim.ca/docs/Bank fees.pdf

Mark Sibthorpe

Recently the CBC and The Globe and Mail both reported on what has been referred to as a consumer “bank fee outcry”. CBC compares banks to cable and phone companies, standing accused of trying to gouge customers with service fees. The backlash appears to have originated in conjunction with the NDP and the Consumers Council of Canada which argues that there is anxiety ‘among consumers about banking fees’.


Cheap Oil Report  

fsim.ca/docs/co2.pdf

Cheap oil has pushed the Bank of Canada's governor, Stephen Poloz onto a slippery slope. For some background on this, take October 22nd, when Poloz bid farewell to forward guidance, resulting in yesterday's surprise rate cut. A cut that has enraged TD and other banks, which see this as eroding profits.
 


Canada's Economy, a strategic solution  

fsim.ca/docs/ces.pdf

This report explores Canada's strategies to compete globally. The report begins with an analyses of the housing market, because housing is the canary in the coal mine; explores what happens in the event of collapse; and analyses the underlying problem causing Canada to be uncompetitive.
 


Complete loyalty RFP  

fsim.ca/docs/booksample.pdf

Merchants that want to understand loyalty, credit and mobile payments should read this book. It offers readers a step-by-step methodology for evaluating and transforming credit and loyalty programs. The strategies are based on proven examples and facts. The Nectar, Target, Canadian Tire and Walmart case studies are examples of the practical approach I have taken, written with the intent that merchants can use them as blueprints for their own initiatives.
 


Mobile Payments Blueprint: guide to credit and loyalty transformation for merchants  

fsim.ca/docs/booksample.pdf

Merchants that want to understand loyalty, credit and mobile payments should read this book. It offers readers a step-by-step methodology for evaluating and transforming credit and loyalty programs. The strategies are based on proven examples and facts. The Nectar, Target, Canadian Tire and Walmart case studies are examples of the practical approach I have taken, written with the intent that merchants can use them as blueprints for their own initiatives.
 


Report on merchants extending financial services  

fsim.ca/docs/

Special report explaining why some merchants in the UK, U.S. and Canada are expanding their financial services. The paper discusses the structural and regulatory pressures facing merchants and explains the rational behind key decisions. This is an 8 page high level report
 


Guide to system selection  

fsim.ca/docs/gssnow.pdf

Read sample report: Guide to system selection. This sample would normally cost $99 but is available free as a sample. Click here view sample report.


News feed

BANK OF ENGLAND MULLS BIGGEST INTEREST-RATE RISE IN 33 YEARS

FP (2023-02-19)

With prices rising five times faster than the U.K. central bank’s two per cent target and the pound falling almost daily, policy makers led by Bank of England Governor Andrew Bailey are under pressure to step up the pace of monetary tightening.


FORECASTERS SPLIT ON HOW HIGH BANK OF CANADA WILL PUSH NEXT RATE HIKE

G&M - Mark Rendell (2022-12-05)

The Bank of Canada is expected to cap its tumultuous year with another interest-rate increase this week, although private-sector forecasters are split on how big the bank will go as it appears to be approaching a turning point for monetary policy.


YES, THE BANK OF CANADA HAS WAGED A ‘CLASS WAR’ – BUT NOT THE ONE YOU THINK

G&M - John Rapley (2022-12-05)

Central bankers must be feeling punch-drunk. For years, they strode like superheroes. We praised their genius, bestowed them with titles such as “maestro” – as one journalist labelled Alan Greenspan in a now-infamous encomium – and revelled in the New Jerusalem to which they’d delivered us: a Promised Land of low inflation and endless credit, where all we had to do to get rich was buy a house and watch it grow.


NATIONAL BANK SCRAPS BORROWERS’ ABILITY TO TRANSFER MORTGAGES TO NEW HOMES

G&M - Erica Alini (2022-12-05)

National Bank of Canada no longer allows customers to transfer their existing mortgages after purchasing new properties, meaning clients hoping to move to new homes can’t hold on to low interest rates locked in before the recent surge in borrowing costs.


CIBC LOSES BILLION-DOLLAR SUIT TO NEW YORK HEDGE FUND OVER DEBT DEALS DATING BACK TO THE 2008 U.S. HOUSING CRISIS

G&M - Jameson Berkow (2022-12-05)

Canadian Imperial Bank of Commerce could be forced to pay more than US$1-billion in damages after being found liable for losses incurred by a New York hedge fund over two debt deals dating back to the 2008 U.S. housing crisis.


WATCH LEVERAGED LOANS AS CANARY IN CREDIT COAL MINE, TRADERS SAY

Yahoo Finance - Olivia Raimonde and Sebastian Boyd (2022-12-05)

“While loans have performed well in an extremely challenging year, the path going forward is more problematic,” said Christian Hoffmann, a portfolio manager for Thornburg Investment Management. “As we get closer to short-term rates falling and defaults rising, the market could lose interest in the asset class.”


BITCOIN SINKS FURTHER 70% IN STANDARD CHARTERED LIST OF POSSIBLE 2023 UPSETS

Yahoo Finance - Joanna Ossinger (2022-12-05)

A further Bitcoin plunge of about 70% to $5,000 next year is among the “surprise” scenarios that markets may be “under-pricing,” the bank’s Global Head of Research Eric Robertsen wrote in a note on Sunday.


REVENUES RISE, BUT PROFITABILITY SLIDES AT CANADIAN WESTERN BANK

FP - Stephanie Hughes (2022-12-05)

The bank’s adjusted earnings was $82 million or $0.88 per share in the three-month period ending Oct. 31, down 15 per cent from the same quarter last year. CWB joining most of the Big Six banks by raising its quarterly dividend, in its case by one cent to $0.32 per share.


CANADIAN BANK BONUSES RISE 1.9% AS FIRMS LOOK PAST SLOWDOWN

FP - Kevin Orland (2022-12-05)

The country’s six largest lenders set aside $19.4 billion (US$14.5 billion) for performance-based compensation in the fiscal year that ended Oct. 31. That marks a sharp slowdown from the 18 per cent increase in bonuses in fiscal 2021 and is far short of the five-year average of 8.2 per cent.


U.S. FED PROPOSES PLAN FOR BANKS TO MANAGE CLIMATE-LINKED FINANCIAL RISK

Reuters - Chris Prentice (2022-12-05)

Those financial impacts "pose an emerging risk to the safety and soundness of financial institutions and the financial stability of the United States," the Fed said.


GLOBAL BANKS TAKE AXE TO JOBS AS COST PRESSURES MOUNT

Reuters (2022-12-05)

Banks typically trim jobs towards the end of the year, but 2022 has seen a bigger wave of redundancies and layoffs.


US DOLLAR ERASES MORE THAN HALF OF THIS YEAR GAINS ON FED RATE BETS

Bloomberg (2022-12-05)

The US dollar has erased more than half of this year’s gains amid growing expectations the Federal Reserve will temper its aggressive rate hikes, and as optimism grows over China’s reopening plans. 


ASSET MANAGEMENT: IS BLACKROCK BECOMING A TECH COMPANY?

FT - Harriet Agnew (2022-12-05)

Just as Amazon developed cloud technology for its own needs and then commercialised it, BlackRock built the Aladdin portfolio management system to manage its own holdings and started offering it to clients in 1999, Brooke Masters and I explore in this article.


NEW YORK’S ‘ZOMBIE’ OFFICE TOWERS TEETER AS INTEREST RATES RISE

FT - Joshua Chaffin (2022-12-05)

During a prolonged bull market fuelled by historically low interest rates and nearly free money Doug Harmon and his team presided over record-breaking sales for many of Manhattan’s trophy office buildings. No longer.


WHY WE SHOULD WELCOME THE YIELD CURVE INVERSION

G&M - Ian McGugan (2022-12-05)

Canada’s bond market is emitting its clearest warning in decades that an economic downturn lies ahead.


EMERGENCY TOOLS TO HELP HOMEOWNERS WITH GROWING MORTGAGE PAYMENTS INCLUDE 40-YEAR AMORTIZATIONS

G&M - ERICA ALINI (2022-12-05)

Lenders and mortgage insurance providers are using emergency loan-modification options that will allow some struggling homeowners to extend their amortization periods, or reduce or defer payments, as mortgage payments soar along with interest rates.


CANADA 'WATCHING CLOSELY' AS BIDEN PRESSED TO FIX INFLATION REDUCTION ACT 'GLITCHES'

Yahoo Finance (2022-12-05)

"It's something we're watching closely and we're engaged with our European counterparts, as well as our American counterparts, to make sure that we're working together," Trudeau told a news conference Monday.


MONTREAL HOME SALES DOWN 38 PER CENT TO ONE OF THE LOWEST LEVELS ON RECORD

FP (2022-12-05)

“Nevertheless, in November, the number of new listings is trending downward again, indicating that potential sellers are not rushing to sell their properties, or are not yet feeling compelled to do so,” Charles Brant, director of market analysis at QPAREB, said in the report.


BIG BANKS BRACE FOR A DOWNTURN THAT HASN'T FULLY ARRIVED

FP (2022-12-05)

Dave McKay, president and chief executive officer at RBC, said elevated uncertainty has been prompting investors to stay on the sidelines, affected asset values and dampening capital markets revenue. He added that while he sees silver linings like a strong jobs market and inflation that has appeared to have peaked, the bank is still cautious on the economic outlook largely because of high house prices and associated levels of consumer debt, high energy prices, and political and geopolitical tensions.


CANADA'S HOUSING BUBBLE HAS FINALLY POPPED — DON'T UNDERESTIMATE THE IMPACT

FP - David Rosenberg (2022-12-05)

The Canadian housing bubble has popped, with prices down 14 per cent from the peak reached in the first quarter of the year. Looking at home affordability — the ratio of mortgage payments to income — we estimate it will take another 25 per cent drop in home prices for affordability to return to its historic average. That would chop roughly $1 trillion in home equity, enough to generate serious negative wealth effects.


FX SWAP DEBT A $80 TRILLION 'BLIND SPOT' GLOBAL REGULATOR SAYS

Reuters - Marc Jones (2022-12-05)

 Pension funds and other 'non-bank' financial firms have more than $80 trillion of hidden, off-balance sheet dollar debt in FX swaps, the Bank for International Settlements (BIS) said.


SWISS WATCHDOG PROBES BANKS OVER SHARING PAY DETAILS

Reuters (2022-12-05)

The Swiss competition commission has opened a preliminary investigation into whether dozens of banks were improperly sharing information about what they pay some staff, it said on Monday.


US REAL ESTATE PRICES COULD PLUNGE 20%, “SEVERE” RECESSION POSSIBLE : DALLAS FED

Better Dwelling (2022-12-05)

US home prices made lofty gains over the pandemic—a bigger run up than the one seen before the Great Recession. It’s going to be difficult to not see a significant chunk of those gains given back to the market, warned the Dallas Fed. Researchers from the US Federal Reserve branch warn severe recession is still possible. They need to tread carefully, since falling home prices can set off a negative feedback loop for the economy.


CANADIAN BUILDING PERMITS FALL AS DEVELOPERS PLAN 5% FEWER UNITS

Better Dwelling (2022-12-05)

Canadian building permits continued to fall, making its second consecutive decline. Total permit values fell to $10.0 billion in October, down 1.4% from the previous month. In real terms, this worked out to a 0.9% decline, according to Stat Can. Permit values remain elevated compared to pre-2020, so this isn’t an alarming throttle. However, it’s worth noting that the drop in permit value is entirely due to housing.


BANKS PREPARE FOR ECONOMIC TURBULENCE AFTER MIXED ANNUAL RESULTS

G&M - James Bradshaw (2022-12-02)

Canada’s major banks wrapped up their fiscal year on an uneasy note, with a boost to profit margins from rising interest rates offset by inflated costs and gradual increases in loan losses as customers start to feel the strain from higher borrowing costs.


TD BANK’S FOURTH-QUARTER PROFIT EXCEEDS EXPECTATIONS ON HIGHER RATES BOOST

G&M - James Bradshaw (2022-12-02)

Toronto-Dominion Bank reported adjusted fourth-quarter profits that beat expectations and raised its dividend as higher margins earned on loans helped drive strong retail banking returns in Canada and the U.S.


THE BANK OF CANADA’S INDEPENDENCE TAKES ANOTHER HIT

G&M - Konrad Kabasuki (2022-12-02)

Bank of Canada Governor Tiff Macklem is back in the hot seat after the central bank this week announced a $522-million third-quarter loss, the first such red ink in the institution’s nearly nine-decade history. More losses are expected in the coming months, creating an awkward situation for the federal government and raising inevitable questions about the bank’s independence.


MORTGAGE COSTS NOW EAT 67% OF INCOME IN CANADA: NATIONAL BANK

Yahoo Finance - Michelle Zadikian (2022-12-02)

The last time mortgage costs took this big of a bite out of Canadians’ incomes, Dolly Parton’s 9 to 5 was topping the Billboard 100 chart.


CANADA BANKS’ LENDING MARGINS IN SPOTLIGHT AS ECONOMY SLOWS

Yahoo Finance - Kevin Orland (2022-12-02)

Toronto-Dominion Bank, which has a large retail-banking presence in both Canada and the US, is making the most of rising interest rates. The bank reported Thursday that its net interest margin expanded to 1.81% in the three months through October, up 7 basis points from the previous quarter.


GLOBAL CENTRAL BANKS BRACE FOR ‘GREENFLATION’ AND CLIMATE CHANGE

Yahoo Finance - Siegfrid Alegado and Anup Roy (2022-12-02)

The shift to green energy may be “inflationary and even slightly stagflationary,” Bank of France Governor Francois Villeroy de Galhau said Friday, speaking virtually on a panel at a central bank conference in Bangkok. “I stress might, we don’t know yet.”


BANK OF CANADA COULD DELIVER ANOTHER HALF-POINT HIKE NEXT WEEK

FP - Larysa Harapyn (2022-12-02)

Brett House, fellow at Public Policy Forum, talks with Financial Post’s Larysa Harapyn about what the latest GDP reading on Canada’s economy means to the Bank of Canada which will decide on interest rates on Dec. 7.


FLORIDA PULLS $2 BLN FROM BLACKROCK IN LARGEST ANTI-ESG DIVESTMENT

Reuters - Ross Kerber (2022-12-02)

Florida's chief financial officer said on Thursday his department would pull $2 billion worth of its assets managed by BlackRock Inc (BLK.N), the biggest such divestment by a state opposed to the asset manager's environmental, social and corporate governance (ESG) policies.


BANK OF CANADA HAS ROOM TO STOP HIKING BEFORE FED, SURVEY SHOWS

Bloomberg (2022-12-02)

The Bank of Canada has leeway to end its interest-rate hiking cycle in coming months even if the Federal Reserve keeps pushing borrowing costs higher next year, according to economists.


CANADA’S REAL ESTATE BUBBLE IS APPROACHING THE LARGEST IN HISTORY

Better Dwelling (2022-12-02)

Canada’s real estate bubble has blown past the 90s bubble, and is going for the biggest of all time. National Bank (NBF) data shows affordability in Q3 2022 eroded to the worst level since the early 1980s. Just like the 80s bubble, they don’t expect this one to persist for much longer. Affordability is expected to improve next year as home prices continue to fall.


INDUSTRY MOVES THIS WEEK

Investment Executive - Katie Keir (2022-12-02)

Each week, Investment Executive summarizes notable moves across the financial industry. Click link for report.


RBC FACES CHALLENGE RETAINING HSBC CANADA BUSINESS CLIENTS BEFORE TAKEOVER DEAL CLOSES

G&M - Andrew Willis (2022-12-01)

Rival banks are targeting HSBC Bank Canada’s talent and corporate clients as the country’s seventh-largest lender begins an anticipated year-long wait for approval of a takeover by Royal Bank of Canada 

RY-T +0.01%increase   .


CIBC PROFIT FALLS 18% ON HIGHER COSTS, LOAN-LOSS PROVISIONS; HIKES DIVIDEND

G&M - James Bradshaw (2022-12-01)

Canadian Imperial Bank of Commerce 

CM-T +0.93%increase    reported an 18-per-cent drop in fiscal fourth-quarter profit and raised its dividend as the bank was hit by higher expenses and loan loss provisions.


BANK OF MONTREAL POSTS LOWER QUARTERLY PROFIT AS CAPITAL MARKETS SLUMP

G&M (2022-12-01)

Canada’s Bank of Montreal 

BMO-T +0.64%increase    posted a lower fourth-quarter profit on Thursday, as revenue from its capital markets business tumbled and the lender increased provisions for credit losses to brace for potential defaults in the face of a tepid economy.


ONTARIO NAMES KEVAN COWAN AS NEW OSC CHAIR AFTER HEATHER ZORDEL’S DEPARTURE

G&M - Greg Mcarthur (2022-12-01)

The Ontario government has tapped Kevan Cowan to serve as chair of the province’s securities regulator after the unexpected departure of its last chair, Heather Zordel.


RBC DEAL FOR HSBC CANADA FACES HIGH REGULATORY, POLITICAL HURDLES

G&M - Jameson Berkow (2022-11-30)

Royal Bank of Canada 

RY-T +0.42%increase    has won the bidding war for HSBC Bank Canada, but the battle for regulatory approval is just beginning.


BANK OF CANADA REPORTS $522-MILLION THIRD-QUARTER LOSS, LOSING MONEY FOR THE FIRST TIME

G&M - Mark Rendell (2022-11-30)

The Bank of Canada reported a $522-million third-quarter loss on Tuesday, the first time the central bank has lost money in its 87-year history.


HOW RBC PULLED OFF ITS HIGHLY-COVETED $13.5-BILLION DEAL FOR HSBC CANADA — WITH SOME UNINTENDED HELP FROM OTTAWA

G&M - Tim Kiladze (2022-11-30)

He’ll never want to admit it, but Royal Bank of Canada 

RY-T +0.42%increase    chief executive Dave McKay can thank Prime Minister Justin Trudeau, at least in part, for landing Canada’s most coveted bank deal in decades.


SCOTIABANK’S FOURTH-QUARTER PROFIT SLIPS ON HIGHER COSTS, INCREASED LOAN-LOSS PROVISIONS

G&M - James Bradshaw (2022-11-30)

Bank of Nova Scotia reported lower fourth-quarter profit as expenses increased and the bank set aside more money to cover loans that could default, but still beat low expectations on the strength of robust retail banking revenues.


RBC BUYING HSBC CANADA FOR $13.5B

CBC - Pete Evans (2022-11-30)

"This also positions us as the bank of choice for commercial clients with international needs, newcomers to Canada and affluent clients who need global banking and wealth management capabilities," McKay said in a statement Tuesday.


CANADIANS RELIED ON CREDIT MORE IN Q3 AS INFLATION PERSISTED

Yahoo Finance (2022-11-30)

TransUnion says more generation Z consumers entering the credit market likely helped drive the generation's participation up, while credit participation among consumers on the older end of the spectrum actually declined.


'CASH IS KING' RIGHT NOW, SAYS STRATEGIST

Yahoo Finance (2022-11-30)

“Surprisingly, right now cash is king. It's very powerful. You’re getting paid for your cash," she added.


WHY IT'S TIME FOR BORROWERS TO ACCEPT THE NEW NORMAL OF HIGHER RATES AND PLAN ACCORDINGLY

FP - Jason Heath (2022-11-30)

Borrowers with variable-rate mortgages have in many cases already been contacted by their lender to increase their mortgage payments. The Bank of Canada estimates that 50 per cent of variable mortgages — or a staggering 13 per cent of all mortgages in Canada — hit their trigger rates after they increased rates by fifty basis points in October. Variable rates have risen by 3.5 percentage points since March and are expected to rise another 25 to 50 basis points at the Bank’s December interest rate announcement. The central bank estimates payments for borrowers who took out variable-rate mortgages in 2021 had risen by 20 per cent on average by the end of October.


HSBC TO CLOSE 114 BRANCHES IN BRITAIN FROM APRIL 2023

Reuters (2022-11-30)

HSBC, in common with peers such as Lloyds Banking Group (LLOY.L) that has also closed branches in recent months, blamed changing customer behaviour for the move, saying customers are increasingly banking online.


BRUSSELS PROPOSES PLAN TO CONFISCATE FROZEN RUSSIAN ASSETS

Reuters - John Chalmers (2022-11-30)

The European Commission on Wednesday proposed confiscating Russian assets that have been frozen to punish Moscow for the invasion of Ukraine, exploring legal options with the EU's partners to compensate Kyiv for damage to the country.


RBC BOOSTS CANADA LEAD WITH ‘ONCE-IN-A-GENERATION’ HSBC DEAL

Bloomberg - Kevin Orland (2022-11-30)

Royal Bank of Canada’s planned acquisition of HSBC Holdings Plc’s Canadian unit would expand its lead in the country’s heavily concentrated financial market, strengthening its dealings with companies and wealthy individuals, while potentially drawing scrutiny from regulators.


CANADA’S ECONOMY STARTS TO SPUTTER AS HOUSING INVESTMENT PLUNGES

Bloomberg - Erik Hertzberg (2022-11-30)

Canada’s economy is gearing down rapidly after stronger-than-expected growth in the third quarter, potentially giving the central bank leeway to slow its interest rate increases.


U.S. FEDERAL RESERVE TO KEEP RATES HIGHER FOR LONGER TO COMBAT INFLATION, POWELL SAYS

G&M - Christopher Rugaber (2022-11-30)

The Federal Reserve will push rates higher than previously expected and keep them there for an extended period, Chair Jerome Powell said Wednesday, in remarks likely intended to underscore the Fed’s single-minded focus on combating stubborn inflation.


REAL ESTATE INDUSTRY BRACES FOR FOREIGN BUYER BAN

G&M - Carolyn Ireland (2022-11-30)

With financial markets roiling and house prices tumbling, investors in countries around the globe appear to have a diminished zeal for buying real estate outside of their own borders.


RBC FLAGS 'VERY STRONG' $25B INFLUX INTO GICS IN RECENT MONTHS

Yahoo Finance - Michelle Zadikian (2022-11-30)

"Just the scale of moving into the product is probably something to call out," Neil McLaughlin, group head of personal and commercial banking at RBC, said on the call.


RBC MOVES TO BOOST CAPITAL AFTER ANNOUNCING $13.5BN DEAL FOR HSBC CANADA

Yahoo Finance (2022-11-30)

The dividend reinvestment incentive, expected to add about $2 billion in capital, comes amid higher chances of unlikely but disruptive events, said chief executive Dave McKay.


NATIONAL BANK REPORTS Q4 PROFIT DOWN FROM YEAR AGO, RAISES QUARTERLY DIVIDEND

Yahoo Finance (2022-11-30)

"There was quite a lot of action that day, and it was very dislocated. And for us, it affected us."


HSBC EYES NEW ZEALAND SALE, AXES UK BRANCHES AS EMPIRE SHRINKS

Reuters (2022-11-30)

The lender is now shrinking wherever it sees itself as too bloated, and exiting where it is sub-scale compared to local players, spurred on by pressure from its biggest shareholder, Ping An Insurance Group of China.


CANADIAN AUTO LOAN DELINQUENCIES SURGE HIGHER AS CREDIT SIGNALS CHANGE IN DIRECTION

Better Dwelling (2022-11-30)

Canadian auto loan delinquencies are climbing aggressively, hitting rarely seen levels. In Q3 2022, about 1.97% of auto loans had become delinquent. It was a big climb of 0.31 basis points (bps) from last year, an exceptionally high rate of delinquencies. Other than three quarters (Q4 2019 to Q2 2020), the rate hasn’t been this high in at least a decade.


WHERE IS THE GOVERNMENT’S PROMISED COUNCIL OF ECONOMIC ADVISORS? WE SURE COULD USE IT

G&M - DAVID PARKINSON (2022-11-29)

Last April, when the Trudeau government tabled a budget amid some of the most difficult economic questions in decades, it said it was going to seek help finding answers.


CRYPTO LENDER BLOCKFI GOES BANKRUPT IN WAKE OF FTX’S FALL

Yahoo Finance - Kevin Simauchi and Hannah Miller (2022-11-29)

The petition, filed in New Jersey, lists BlockFi’s assets and liabilities at between $1 billion and $10 billion each. The company said in the statement that it had around $257 million of cash on hand, and is starting an “internal plan to considerably reduce expenses, including labor costs.”


BITCOIN CLIMB FAILS TO DISPEL FEARS THAT FTX CONTAGION IS ‘FAR FROM OVER’

Yahoo Finance (2022-11-29)

The largest token rose as much as 2.1% and was trading at about $16,485 as of 10:23 a.m. in London. Second-ranked Ether also posted gains, while meme token Dogecoin surged 10% at one point.


'SERIOUS CONSUMER PROTECTION CONCERNS': INSURANCE WATCHDOG MOVES TO BAN CONTROVERSIAL FEE

FP - Barbara Schecter (2022-11-29)

The Financial Services Regulatory Authority of Ontario (FSRA) is proposing to eliminate deferred sales charges (DSC) — a potentially hefty commission levelled on customers who withdraw funds before the end of a contract — on new segregated fund contracts beginning June 1, 2023.


ANALYSTS CAUTIOUS ON BIG BANK EARNINGS AMID RECESSIONARY HEADWINDS

FP - Stephanie Hughes (2022-11-29)

Schedule of earnings: Scotia Nov 29; RBC Nov 30, NB Nov 30; CIBC Dec 1, BMO Dec 1, TD Dec 1; Can Western Dec 2, Laurentian Dec 2
At least two analysts have revised their earnings expectations for the fourth quarter, pointing to volatile markets, the need to set more money aside for bad loans and and increasing funding costs among other headwinds. 


THE YUAN'S THE NEW DOLLAR AS RUSSIA RIDES TO THE REDBACK

Reuters - Elena Fabrichnaya (2022-11-29)

Chinese entrepreneur Wang Min is delighted about Russia's embrace of the yuan. His LED lights company can price contracts to Russian customers in yuan rather than dollars or euros, and they can pay him in yuan. It's "win-win", he says.


BANKS TO GIVE FINANCIAL UPDATE IN Q4 RESULTS AHEAD OF POSSIBLE RECESSION NEXT YEAR

Investment Executive - Ian Bickis (2022-11-29)

“Margin expansion has been one of the more exciting developments in the banking space, partially offsetting recessionary concerns,” said National Bank analyst Gabriel Dechaine in a note.


EUROPE’S INFLATION LIKELY HASN’T PEAKED, ECB’S LAGARDE SAYS

Investment Executive (2022-11-29)

The ECB has joined the U.S. Federal Reserve and other central banks around the world in rapidly raising rates to combat inflation that spiked as the global economy recovered from the Covid-19 pandemic, then got worse after Russia invaded Ukraine. Central banks risk tipping economies into recession as the world copes with an energy crisis, higher food costs and currencies weakening against the U.S. dollar.


CANADA WANTS TO WELCOME 500,000 IMMIGRANTS A YEAR BY 2025. CAN OUR COUNTRY KEEP UP?

G&M - Matt Lundy (2022-11-28)

The expansion is historic. From July to September, Canada’s population grew by around 285,000, a 0.7-per-cent gain that was the largest since Newfoundland joined Confederation in 1949. More than 700,000 people have been added over the past year, roughly the same as the population of Mississauga, the seventh-largest municipality in the country.


DIRECT LENDER PEMBERTON EYES $50 BILLION TO PLUG EUROPE LENDING HOLE

Yahoo Finance - Dinesh Nair (2022-11-28)

“We are aiming to become a $50 billion manager in the European marketplace over the next five years,” Drake-Brockman said. “There is an opportunity for managers in Europe like ourselves to grow into very substantial platforms, just like the Americans did a few years back.”


JAPAN BIRTHS AT NEW LOW AS POPULATION SHRINKS AND AGES

Yahoo Finance (2022-11-28)

Japan is the world’s third biggest economy but living costs are high and wage increases have been slow. The conservative government has lagged on making society more inclusive for children, women and minorities.


MACQUARIE BETS ON NETWORK INFRASTRUCTURE WITH $13 BILLION RAISE

Yahoo Finance - Dinesh Nair (2022-11-28)

Infrastructure investors are drawn to network assets like electricity grids and gas transmission systems because of their ability to generate steady, long-term returns. Ontario Teachers’ Pension Plan Board this month agreed to buy a 25% stake in SSE Plc’s electricity transmission grid business for about £1.5 billion.


TD BANK AND CANADA POST 'PAUSE' RURAL LENDING PROGRAM, CITING 'IRREGULAR' ACTIVITY

FP - Barbara Shecter (2022-11-28)

Toronto-Dominion Bank said “irregular” activities involving “bad actors” led the bank and partner Canada Post to the pause a new service offering loans to remote communities.
“While no TD customer information was compromised, we did elect to pause the program to investigate,” Amy Thompson, a spokesperson for the bank, said Saturday.


CANADIAN BANKS COUNT ON LOAN GROWTH AS STORMY MARKETS DENT PROFITS

Reuters - Niket Nishant, Divya Rajagopal (2022-11-28)

Top Canadian banks are expected to post a decline in fourth-quarter profits as choppy markets hurt wealth management and a slow deal pipeline dents income from investment banking, offsetting expected gains from business loans.


XI HAS FEW GOOD OPTIONS TO END HISTORIC CHINA COVID PROTESTS

Bloomberg - Colum Murphy and Rebecca Choong Wilkins (2022-11-28)

The protests that erupted against China’s Covid Zero strategy represent one of the most significant challenges to Communist Party rule since the Tiananmen crisis more than 30 years ago. How Xi Jinping responds to it may end up being just as pivotal for the country’s future. 


CANADIAN REAL ESTATE PRICES TO FALL 30%, EARLY STAGES OF RECESSION ARE HERE: OX ECON

Better Dwelling (2022-11-28)

Canadian real estate prices are forecast to fall further, but pandemic-era gains won’t be wiped out—though it will be close. The firm sees prices falling 30% from peak-to-trough, after rising more than 54% since March 2020. For those without a calculator handy, that would leave March buyers with roughly 2.3% compound annual growth rate (CAGR). Not exactly the windfall many believed they were blessed with, especially when soaring inflation is considered. 


MAJOR CRYPTOCURRENCY LENDER BLOCKFI AND EIGHT OF ITS AFFILIATES FILE FOR U.S. BANKRUPTCY PROTECTION

G&M - HANNAH LANG, NIKET NISHANT AND MANYA SAINI (2022-11-28)

Cryptocurrency lender BlockFi has filed for Chapter 11 bankruptcy protection, it said on Monday, the latest crypto casualty following the spectacular collapse of the FTX exchange earlier this month.

The filing in a New Jersey court comes as crypto prices plummet. The price of bitcoin 

BTZ22 -0.34%decrease   , the largest digital currency by far, is down more than 70 per cent from a 2021 peak.


STOCKS FALL, WEIGHED DOWN BY APPLE AND CHINA WORRIES

G&M (2022-11-28)

U.S. stocks ended sharply lower on Monday after protests in major Chinese cities against strict COVID-19 policies sparked concerns about economic growth, while Apple Inc slid on worries about a hit to iPhone production.
The TSX also fell, but only about half as much as major U.S. indexes, in a mixed day of trading across sectors.


READOUT NOTES REVEAL BIG SIX BANKS’ ROLE IN FREELAND’S CONVOY PLAN

G&M - James Bradshaw (2022-11-27)

When Deputy Prime Minister Chrystia Freeland called the chief executive officers of Canada’s Big Six banks on the Sunday in February before her government invoked the Emergencies Act, CEOs stressed that the tools they had to help choke off money pouring in to support the convoy protests were limited.

At that moment, banks needed court orders to freeze funds, the CEOs said, which are slow to be granted. To give banks the power to freeze funds faster, the government needed to sanction the protesters under the same anti-financial-crime laws it uses for terrorists, three CEOs said. They also urged the government to plug gaps in systems for monitoring transactions by bringing in a broader range of payments providers under stricter regulations.

Accounts of at least three calls Ms. Freeland held with bank CEOs over an eight-day span are contained in summaries called “readouts” and in Ms. Freeland’s handwritten notes from the meetings, which were revealed Thursday at the inquiry studying the use of the Emergencies Act. The readouts are general summaries prepared by Ms. Freeland’s staff, and not full transcripts or exact descriptions of what was said.

What the CEOs were not told on the first call on Feb. 13 was that the government was getting ready to use the Emergencies Act to expand the banks’ powers to freeze accounts. In a briefing note sent to Ms. Freeland before the call, her director of economic strategy and planning, Tyler Meredith, wrote: “We have not given them any indication about what is under consideration. ... So your comments may be the first signal of forward guidance.”

Near the end of that call, Ms. Freeland told bank CEOs the government was considering options “which in normal times would be seen as draconian,” according to a readout. Deputy finance minister Michael Sabia told them, “we will not take you by surprise,” promising to keep the CEOs updated on any actions to ensure they were “comfortable and that it is implementable.”

But the banks received only cursory notice before the government announced it would use the Emergencies Act the next day, on Feb. 14. And for days after that, the banks were left scrambling to understand how to execute the government’s orders.

The CEO-level calls came after a flurry of close collaboration between banks and the Finance Ministry in response to the COVID-19 pandemic. But relations between the major banks and Ottawa have ranged from distant to strained in recent years.

Ms. Freeland’s initial outreach was an attempt to involve banks in bringing the convoy protests to an end, and to get bankers’ help in assessing the gravity of the damage to Canada’s economy. Subsequent calls focused on working out the complex mechanics of halting the flow of money to the protesters.

The banks were not necessarily opposed to freezing accounts. Toronto-Dominion Bank CEO Bharat Masrani said on Feb. 13 that if the government designated the protesters as terrorists under the law, “we could act swiftly,” according to a readout of the call – a sentiment echoed by Royal Bank of Canada CEO Dave McKay and Bank of Montreal’s Darryl White. In that scenario, Mr. Masrani also urged government to give banks a list of “mischief makers” to pursue, according to Ms. Freeland’s notes.

On Feb. 13, one CEO after another drove home the grave impact the protests were having on Canada’s reputation and its economy. TD’s Mr. Masrani emphasized that “Canada’s reputation is at risk,” and was echoed minutes later by Canadian Imperial Bank of Commerce CEO Victor Dodig, according to a readout and Ms. Freeland’s own notes.

BMO’s Mr. White is said to have called the blockades “a national crisis,” urging Ms. Freeland “to act immediately” and citing a U.S. investor who told him, “I won’t invest another red cent in your banana republic in Canada,” a readout said.

But at that point, the bank CEOs thought they would be acting under existing laws when they spoke about of labelling protesters as terrorists, not using extraordinary powers to freeze accounts.

Spokespeople for each of the Big Six banks declined to comment on Friday.

At the federal inquiry on Thursday, Ms. Freeland testified that the CEOs’ comments helped crystallize her understanding that the protests were “profoundly jeopardizing” Canada’s economy.

Even before the Feb. 13 call, TD 

TD-T +0.07%increase  

, CIBC 

CM-T +0.68%increase  

 and Bank of Nova Scotia 

BNS-T +0.46%increase  

 had privately encouraged the government to bring non-bank payments providers “more clearly” under existing anti-money-laundering laws, Mr. Meredith wrote in his briefing note to Ms. Freeland.


CANADIAN MORTGAGE BORROWERS TOOK THE BAIT, NOW THEIR COSTS ARE RIPPING HIGHER

Better Dwelling (2022-11-25)

Just over a fifth (21.2%) of insured mortgages outstanding were variable rate in September. That’s up significantly from 16.0% last year, and the 13.3% low for the period back in January 2021. Not as bad as the share seen with uninsured mortgages, but the share still climbed more than half.


REGULATORS SEE THREAT TO STABILITY IN SHADOW BANKS’ GROWTH

Investment Executive - James Langton (2022-11-25)

In a new report, the Basel Committee said that the non-bank financial intermediary sector, also known as the shadow banking sector, represents a concern for global financial stability based on its size, its continued expansion, and its growing connections to the traditional financial sector and the real economy.


OSC ADOPTS NEW FEE MODEL

Investment Executive - James Langton (2022-11-25)

At the same time, it will also collect an additional $13.5 million in participation fees from firms (primarily the large banks) that are active in OTC derivative markets to help finance enhanced oversight of that market.


THE LOOMING $62 BILLION CRYPTO CONTAGION

Forbes - Nina Bambysheva (2022-11-25)

Like stock certificates sprinkled with pixie dust, inflated exchange tokens were at the core of FTX’s spectacular collapse. They are still in widespread use at major cryptocurrency exchanges around the world. Will they be crypto’s undoing?


MPS ADVANCE BILL GIVING PENSION PLAN MEMBERS PRIORITY IN CORPORATE BANKRUPTCIES

G&M - James Bradshaw (2022-11-24)

After a decade of false starts, a federal bill to give pension plan members the highest priority when plan funding falls short in a company bankruptcy has unanimously passed a vote in the House of Commons, pushing a long-debated protection for pensioners closer to becoming law.


INTEREST RATES NEED TO KEEP RISING TO FIGHT INFLATION, TIFF MACKLEM TELLS MPS

G&M - Mark Rendell (2022-11-24)

Parliamentarians questioned Bank of Canada Governor Tiff Macklem about inflation and historic financial losses at the central bank on Wednesday, with top opposition politicians looking to frame the bank’s continuing dilemmas to their political advantage.


CANADIAN VENTURE CAPITAL LEVELS PLUMMET IN THIRD QUARTER AS ECONOMY HITS TECH DEALS

G&M - Sean Silcoff (2022-11-24)

Venture capital investment in Canada has collapsed to its lowest quarterly level since the early days of the pandemic as economic conditions continue to deteriorate and companies seeking investment struggle to find a meeting point on prices with financiers.


SAYING NO TO CRYPTOCURRENCY WAS A GLORIOUS MOMENT FOR CANADA’S INVESTMENT ADVISERS

G&M - Rob Carrick (2022-11-24)

Making the right call in investing sometimes requires you to look excruciatingly wrong for a while.


FED MINUTES SHOW 'SUBSTANTIAL MAJORITY' SUPPORT SLOWING PACE OF RATE HIKES

Yahoo Finance - Jennifer Schonberger (2022-11-24)

A “substantial majority” of Fed officials believe it will soon be time to slow down the central bank's current pace of rate hikes.


SWEDEN'S BIG INTEREST RATE HIKE FOLLOWS OTHER CENTRAL BANKS

Yahoo Finance (2022-11-24)

The increase brings the key rate to 2.5% in the European Union country, which does not use the euro currency so it is not part of the European Central Bank’s decision-making.


THE PROBLEM OF THE BANK OF CANADA’S BALLOONING BALANCE SHEET

Yahoo Finance - STEVE AMBLER AND JEREMY KRONICK (2022-11-24)

The Bank of Canada’s ballooning balance sheet has received lots of attention lately. From $120 billion in early March 2020 it grew over the next 12 months to $575 billion and it still stands at $414 billion today, more than three times what it was. That happened because in response to the pandemic the Bank purchased Government of Canada bonds from commercial banks. It added the bonds to the asset side of its balance sheet and paid for them by boosting “settlement balances” — basically, the commercial banks’ bank accounts with it — on the liability side. Voilà, a ballooned balance sheet.


BANK DEPOSIT RATES LAG CHANGES IN FED POLICY RATE, NY FED ANALYSTS SAY

Reuters (2022-11-24)

Banks aren't matching Fed rate rises because in effect they don't have to. "Deposits have increased significantly as a source of funding for the banking sector," New York Fed analysts Alena Kang-Landsberg and Matthew Plosser wrote in a research paper released by the regional bank this week. "One reason banks may be reluctant to raise deposit rates is that they have more deposits than they really need, so they are willing to allow depositors to seek better rates elsewhere."


BINANCE’S ZHAO FLAGS POSSIBLE $1 BILLION FOR DISTRESSED ASSETS

Bloomberg - Sidhartha Shukla and Anna Irrera (2022-11-24)

Crypto billionaire Changpeng “CZ” Zhao further outlined his plans to backstop the stricken industry, pledging to amass at least $1 billion for buying distressed assets and saying his Binance Holdings Ltd. will make another bid for bankrupt lender Voyager Digital.


FINTECH GIANT FIS TO CUT THOUSANDS OF JOBS AS NEW CEO TARGETS COSTS

Bloomberg - Jennifer Surane (2022-11-24)

Fidelity National Information Services Inc. plans to dismiss thousands of workers as part of incoming Chief Executive Officer Stephanie Ferris’s strategy to win back investor confidence after the fintech giant slumped 44% this year.


MOST OF CANADA’S PEAK HOME BUYERS WITH A MINIMUM DOWNPAYMENT ARE UNDERWATER

Better Dwelling (2022-11-24)

Ontario real estate markets went from leading on the way up to the way down. In dollar terms, a typical Kitchener-Waterloo buyer was $146,500 underwater in October. By far it was the worst, with Cambridge (-$140,000), and London-St. Thomas (-$137,000) following not far behind. Six-figure exits from a home in a small city at least an hour from Toronto sounds painful, to put it lightly.


CITI’S LIVING WILL NEEDS WORK: BANKING REGULATORS

Investment Executive - James Langton (2022-11-24)

The “living will” filed by Citigroup Inc. has some “serious weaknesses,” U.S. federal banking regulators say.


VERSABANK TO ANNOUNCE FOURTH QUARTER AND ANNUAL 2022 FINANCIAL RESULTS ON DECEMBER 7, 2022

Press Release (2022-11-24)

The presentation material referenced during the call will be available on the Bank’s website (www.versabank.com), SEDAR (www.sedar.com) and EDGAR (https://www.sec.gov/edgar). The audio conference line will be available at: 416-764-8659 or 1-888-664-6392 (toll free).


BANKERS FACE MODEST YEAR-END BONUS CUTS THIS YEAR BUT BIGGER PAIN AHEAD

G&M - James Berkow (2022-11-24)

Bay Street bankers who were bracing for major cuts to year-end bonuses can expect some delay to their disappointment, but the respite will likely be brief.


ALLIED PROPERTIES REIT EXPLORES SELLING ASSETS WORTH $1.3-BILLION TO EASE DEBT WOES AFTER INTEREST RATES SOAR

G&M - Tim Kiladze (2022-11-24)

Office property owner Allied Properties REIT is considering the sale of its data-centre portfolio, a deal that would help the commercial landlord pay down debt as it retools for a new era of higher interest rates and hybrid working.


ONLY WEEKS AFTER LAUNCH, TD HITS PAUSE ON LOAN PROGRAM PARTNERING WITH CANADA POST

CBC - Philippe de Montigny, Pete Evans (2022-11-24)

"Since the launch, the product was paused both online and in physical locations, after experiencing processing issues," the bank said, without elaborating. "We're still working through this and will update accordingly."


THE CRA IS ALREADY CHALLENGING REAL ESTATE TRANSACTIONS AHEAD OF NEW ANTI-FLIPPING RULES

FP - Jamie Golombek (2022-11-24)

But the Canada Revenue Agency isn’t waiting around for this new legislation to come into force. It’s currently challenging perceived real estate “flips” through the court system, with mixed results, depending on the facts of the case.


POSTAL SAVINGS BANK OF CHINA TO PROVIDE $39 BLN OF PROPERTY SECTOR FINANCING

Reuters (2022-11-24)

Postal Savings Bank of China has agreed to provide a total of 280 billion yuan ($39.17 billion) in financing to property companies including Vanke, Longfor and Country Garden, it said in a statement on Thursday.


JPMORGAN, DEUTSCHE BANK SUED BY EPSTEIN ACCUSERS IN NEW YORK

Bloomberg - Katharine Gemmell (2022-11-24)

JPMorgan Chase & Co. and Deutsche Bank AG were accused of enabling the sexual abuse of Jeffrey Epstein in New York class action suits that allege the banks turned a blind eye in order to “churn profits.”


AMAZON FACES BLACK FRIDAY PROTESTS AND STRIKES IN 40 COUNTRIES

BNN (2022-11-24)

“While we are not perfect in any area, if you objectively look at what Amazon is doing on these important matters you’ll see that we do take our role and our impact very seriously,” Amazon spokesman David Nieberg said. 


FTX INVOKED BY CANADA BANKS GROUP IN CALL FOR PAYMENT SAFEGUARDS

Bloomberg - Kevin Orland (2022-11-24)

The main lobbying group for Canada’s banking industry invoked the collapse of FTX and Celsius Network in warning that the government needs to establish better consumer protections for the country’s payments systems.


MANULIFE ELIMINATES 50 JOBS AS IT OUTSOURCES PROPERTY MANAGEMENT

Bloomberg - Kevin Orland (2022-11-24)

Manulife Financial Corp. is eliminating about 50 jobs in the US and Canada as part of a plan to outsource some real estate operations and focus more on investing.


STUDENT LOAN BORROWERS LOSE FAITH IN BIDEN’S FORGIVENESS PLAN

Bloomberg - Claire Ballentine and Ella Ceron (2022-11-24)

For student loan borrowers, President Joe Biden’s forgiveness plan seemed too good to be true. And now they fear that maybe it was. 


HOME OWNERS WITH VARIABLE-RATE MORTGAGES FACE DIFFICULT SQUEEZE AS INTEREST RATES RISE, HOUSE PRICES DROP, BANK OF CANADA WARNS

Mark Rendell (2022-11-23)

Canada’s financial system should be able to weather a period of heightened stress, but many recent home buyers could experience a “painful” squeeze as interest rates continue to rise, the Bank of Canada’s second-in-command said Tuesday.


YES, BANKS PROFIT FROM BORROWERS WHO ARE SQUEEZED BY HIGHER RATES. BUT THERE’S MORE TO THE STORY

G&M - Rob Carrick (2022-11-23)

Dec. 7 will be a good day in Canadian banking.


HALF OF VARIABLE-RATE FIXED-PAYMENT MORTGAGES HAVE HIT TRIGGER RATE: BANK OF CANADA

Yahoo Finance - Michelle Zadikian (2022-11-23)

Most variable-rate mortgages in Canada have static monthly payments, meaning the payment will remain the same even as interest rates change. Trigger rates are activated when the interest portion exceeds the payment itself, and it's a trend that has become more widespread amid the sharp jump in interest rates this year.


ICELAND EXTENDS WESTERN EUROPE’S LONGEST TIGHTENING TO 6%

Yahoo Finance - Ragnhildur Sigurdardottir (2022-11-23)

Iceland’s continued aggression coincides with an earlier decision on Wednesday by New Zealand’s central bank to raise by a record 75 basis points, and Sweden’s Riksbank is expected to unveil a 75 basis-point hike on Thursday. By contrast, some global counterparts may dial down their tightening. Just this week, two Federal Reserve officials reinforced expectations that US rate hiking will start slowing.


BIG BANKS STARTING TO EXHIBIT POLICY DIFFERENCES ON CLIMATE CHANGE, ADVOCACY GROUP SAYS

FP - Barbara Shecter (2022-11-23)

The advocacy group gave Toronto-Dominion Bank a grade of B- for financed emissions reduction targets, the highest among the big banks in that or any other category. Bank of Montreal, meanwhile, scored highest of the group for its transition plan to reduce high-carbon financing, especially of fossil fuels, with a grade of C+.


HOW BAD WILL HOUSING GET? THE CHILL GRIPPING A ONCE-HOT MARKET OFFERS A TEST

Bloomberg - Ari Altstedter, Kevin Orland, and Lizzie Kane (2022-11-23)

For the past 25 years, Canada has been in the grip of the world’s biggest housing boom, a near unbroken run of price appreciation unparalleled among its developed peers. 


CANADA NEEDS LOWER HOME PRICES & ECONOMIC STABILITY REQUIRES “PAIN”: BANK OF CANADA

Better Dwelling (2022-11-23)

“Over the course of less than two years house prices went up by more than 50% in most markets. And housing activity—the number of houses being bought and sold—was about 30% higher than pre-pandemic levels,” she emphasized. 


INVESTORS COMING TO GRIPS WITH HORRIFIC YEAR FOR BONDS

Investment Executive - Rudy Luukko (2022-11-23)

“The key for investors is not so much what the Fed does on a given day, [but] rather the read on the expected longer-term trajectory for financial conditions, inflation and the health of the economy,” said Myles Zyblock, chief investment strategist with Toronto-based Dynamic Funds, in an Oct. 31 market commentary. “At this stage, inflation has remained stubbornly high, leaving the Fed with little wiggle room to take their foot off the brakes.”


FUND COMPANIES FACE UNCERTAIN FUTURE AS RISKS PILE UP

Investment Executive - James Langton (2022-11-23)

Mutual fund assets under management (AUM) have been in steady retreat after soaring above $2 trillion in the fourth quarter of 2021 on the strength of robust global markets. According to data from the Investment Funds Institute of Canada (IFIC), at the end of Q3 2022, mutual fund AUM was about $1.75 trillion — almost exactly where it was at the start of 2021.


RBC JUMPS ON SWIFT GO FOR CROSS-BORDER PAYMENTS

Finextra (2022-11-23)

RBC has now partnered Swift, as well as JP Morgan, to help Canadian businesses send cross-border payments of up to $10,000 in foreign currencies with "speed, security, predictability and efficiency".


S&P 500 COULD DROP AS LOW AS 2,500 BEFORE THIS BEAR MARKET IS FINISHED

FP - David Rosenberg (2022-11-22)

One of our key themes this year has been that earnings estimates were wildly optimistic. Analysts are now beginning to come around to this view, with 2023 S&P 500 earnings per share (EPS) being trimmed to US$237 from a peak of US$249. However, if a recession hits next year — our base case — there is still a lot further to go in terms of the stock market discounting a realistic earnings profile.
One of our key themes this year has been that earnings estimates were wildly optimistic. Analysts are now beginning to come around to this view, with 2023 S&P 500 earnings per share (EPS) being trimmed to US$237 from a peak of US$249. However, if a recession hits next year — our base case — there is still a lot further to go in terms of the stock market discounting a realistic earnings profile.


COUNTRY'S BIGGEST UNION TO KEEP DEMANDING WAGE HIKES, SQUEEZING BANK OF CANADA

FP - Randy Thanthong-Knight (2022-11-22)

Lana Payne, president of Unifor, warned in an interview that workers need to be compensated for damage already done to their purchasing power.


CHINA SET TO FINE ANT GROUP OVER $1 BILLION, SIGNALLING REVAMP NEARS END-SOURCES

Reuters - Julie Zhu (2022-11-22)

Chinese authorities are poised to impose a fine of more than $1 billion on Jack Ma's Ant Group, said six sources with direct knowledge of the matter, setting the stage for ending the fintech company's two-year long regulatory overhaul.


US SANCTIONS THREAT ZAPS RUSSIA’S HOMEGROWN MIR CARDS IN SETBACK

Bloomberg (2022-11-22)

Russia’s international ambitions for its homegrown alternative to Visa and Mastercard have been dashed as even some of its closest allies have dropped its Mir payment system following a threat by the US to sanction anyone who helps or supports its use. 


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BANK OF ENGLAND MULLS BIGGEST INTEREST-RATE RISE IN 33 YEARS

FP (2023-02-19)

With prices rising five times faster than the U.K. central bank’s two per cent target and the pound falling almost daily, policy makers led by Bank of England Governor Andrew Bailey are under pressure to step up the pace of monetary tightening.


FORECASTERS SPLIT ON HOW HIGH BANK OF CANADA WILL PUSH NEXT RATE HIKE

G&M - Mark Rendell (2022-12-05)

The Bank of Canada is expected to cap its tumultuous year with another interest-rate increase this week, although private-sector forecasters are split on how big the bank will go as it appears to be approaching a turning point for monetary policy.


YES, THE BANK OF CANADA HAS WAGED A ‘CLASS WAR’ – BUT NOT THE ONE YOU THINK

G&M - John Rapley (2022-12-05)

Central bankers must be feeling punch-drunk. For years, they strode like superheroes. We praised their genius, bestowed them with titles such as “maestro” – as one journalist labelled Alan Greenspan in a now-infamous encomium – and revelled in the New Jerusalem to which they’d delivered us: a Promised Land of low inflation and endless credit, where all we had to do to get rich was buy a house and watch it grow.


NATIONAL BANK SCRAPS BORROWERS’ ABILITY TO TRANSFER MORTGAGES TO NEW HOMES

G&M - Erica Alini (2022-12-05)

National Bank of Canada no longer allows customers to transfer their existing mortgages after purchasing new properties, meaning clients hoping to move to new homes can’t hold on to low interest rates locked in before the recent surge in borrowing costs.