The Globe and Mail reports in its Tuesday, Aug. 26, edition that BMO Nesbitt Burns analyst Sohrab Movahedi is bullish on Canadian banks, rating the sector "outperform." The Globe's Darcy Keith, Jody White and Tim Shufelt write in the Eye On Equities column that Mr. Movahedi expects the banks to deliver strong earnings growth, low credit losses and resilient domestic loan growth into next year. Mr. Movahedi says: "With higher and better quality capital levels, profitability driven by improving return on assets (not leverage), steady to improving fundamentals, and favourable 'technicals' (i.e., relative yield, foreign funds flow, etc.), Canadian bank valuations could remain above their historical levels for the next year or so. ... Furthermore, there could be valuation upside. In a period of cyclically low credit costs, persistently low rates, and continuing slow growth, we believe Canadian banks are likely to remain compelling investment alternatives." Canadian banks have posted total returns of about 33 per cent in the last 12 months, about 7 per cent higher than the overall Canadian market. Meanwhile, a Canadian housing calamity has not transpired. Consumer credit growth remains resilient.