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Canadian Imperial Bank of Commerce (CIBC)
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Close 2022-08-29 C$ 64.11
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Post says Big Five banks find consumers still resilient

2022-08-30 09:29 ET - In the News

See In the News (C-RY) Royal Bank of Canada

The Financial Post reports in its Tuesday edition that the Canadian consumer remains well positioned to take on an economic downturn even though inflation is running at multidecade highs and more people are feeling the financial pinch. The Post's Stephanie Hughes writes that a common theme among Canada's bank executives during third-quarter results announced last week was their confidence in the resilience of consumers, who are still enjoying larger-than-normal savings buffers and low impaired loan rates. Economic factors, including a strong job market, are also driving optimism. "While we closely monitor early warning indicators, both gross impaired loans and [provisions for credit losses] on impaired loans remain low as our clients continue to demonstrate resilience despite rising costs," said Royal Bank of Canada chief executive officer Dave McKay during an Aug. 24 call. A recent Deloitte economic outlook report credited consumer spending and residential investments as drivers that pulled Canada out of a recession during the tail end of the pandemic, but cast some doubt on whether consumers can continue to carry the day as inflation pressures outpace wage growth and mortgage renewals at higher rates come due.

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