Healthy banks getting together to save one of their industry brothers.
First Republic Bank gets $30 billion in deposits from big banks (msn.com)
First Republic Bank gets $30 billion in deposits from big banks (msn.com)
Bank regulations are much, much stricter and capital requirements much more fulsome in Canada than in America.Canadian banks are at bigger risk. They write million dollar mortgages to people earning 80k a year (140k couple). BofC has lagged the Fed in raising rates to counter inflation because they know it'd destroy Canada's economy (housing).
I feel they can collapse anytime and the Canadian govt can't even afford a bailout since they blew it all on COVID restrictions (to enrich govt approved suppliers - aka criminals - with lucrative contracts).
I have $600 in my Canadian bank account that's it.
As they need to be due to overpriced housing market. If they were any looser, the govt would be asking the IMF for bailout.Bank regulations are much, much stricter and capital requirements much more fulsome in Canada than in America.
The last time the Canadian government "bailed out" the Canadian banks, I think the government received back mortgage assets in return for loans. I think the government got back every cent of their loans to the bank.As they need to be due to overpriced housing market. If they were any looser, the govt would be asking the IMF for bailout.
Let's see if it works this time. 7% inflation, wage stagnation, and million dollar mortgages. Either this (IR hikes); or they pause/slow rate hikes and build a huge trade deficit (USDCAD= 1.8) with next door neighbor.The last time