Risks Increase For Canadian Banks

Have you heard of the Bank for International Settlemenets ? Well, don’t worry, hardly anyone has heard of them.

But they do trace financial flows around the world.

And one of their reports (Highlights of Global Financial Flows –Early Warning Indicators for Stress in Domestic Banking) ) today highlighted domestic banks in a number of countries . Canada shows increased risk on three out of four criteria. The four criteria are: credit to GDP ratio, property price gap, debt service ratio and debt service ratio if rates rise 250 basis points. On one , two and four Canada is above normal risk limits.

This is a bit of a wake up call and no doubt the Federal Finance Department and the Bank of Canada have read the report.

It ‘s quite likely this won’t make the evening news but I think one of the positives of blogs is to highlight important information that the regular news outlets do  not carry.

What’s the motto of the regular news? If it bleeds , it leads.

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