The Financial Post reports in its Thursday, May 9, edition that Stephen Poloz, who was appointed Governor of the Bank of Canada six years ago, is now in the final year of his mandate. The Post's Kevin Carmichael writes that it is doubtful Mr. Poloz, at age 62, will apply for a second term.
No BOC governor has served longer than seven years since Gerald Bouey, who was appointed in 1973 and retired in 1987. The Post says Mr. Poloz appears to be in a mood to make some noise ahead of his exit, like calling for changes in the Canadian mortgage market.
He wondered aloud this week why almost half of all mortgages issued by a supposedly competitive financial system are for five years at fixed rates. He lamented the failure of Canada's sophisticated bankers to create a secondary market for mortgage-backed securities that are not guaranteed by the federal treasury. He criticized them for lacking imagination. He said, "There are many other possible variations on mortgage design, so many that it makes me wonder why so little has happened in my lifetime." Surely Mr. Poloz knows little has happened because a five-member oligopoly that splits gargantuan profits has little incentive to mess with a good thing.
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