Bank brushes off fears of housing meltdown
Late last week, Canadian Imperial Bank of Commerce announced its intention to keep expanding its market share in mortgages, despite concerns among various quarters that a sharp decline in housing prices imminent.
Bucking the trend in Canada’s bank index—which has retreated since the start of the year over fears that that the red-hot Toronto and Vancouver markets are in a precarious state—CIBC said that its home loan book had grown by 13 per cent year-over-year at the end of June, up to $197 billion.
“We’re very comfortable with our mortgage growth. We’ve been growing faster than the market and that may continue for a little while longer,” CIBC CFO Kevin Glass told Reuters.
“We are not at this point anticipating any sort of hard landing. I think there may be some moderation,” Glass added.
Currently, the bank has the largest exposure to the domestic housing market among Canadian financial institutions.
CIBC, which has been steadily growing its internal mortgage sales force since 2012 instead of using outside brokers, noted that its mortgage channel is helping it cross-sell other financial services to borrowers—a factor that has contributed to its mortgage growth in the past few years.
Shares of CIBC are down 3.6 percent in 2017, but the bank has reported a 9-per-cent increase in net income (up to $1.17 billion) due to reliable retail business performance, making up for a weaker capital markets division.
Related stories:
Too much tightening
Higher BoC rate could draw out Toronto’s housing slowdown – CIBC’s Tal
Bucking the trend in Canada’s bank index—which has retreated since the start of the year over fears that that the red-hot Toronto and Vancouver markets are in a precarious state—CIBC said that its home loan book had grown by 13 per cent year-over-year at the end of June, up to $197 billion.
“We’re very comfortable with our mortgage growth. We’ve been growing faster than the market and that may continue for a little while longer,” CIBC CFO Kevin Glass told Reuters.
“We are not at this point anticipating any sort of hard landing. I think there may be some moderation,” Glass added.
Currently, the bank has the largest exposure to the domestic housing market among Canadian financial institutions.
CIBC, which has been steadily growing its internal mortgage sales force since 2012 instead of using outside brokers, noted that its mortgage channel is helping it cross-sell other financial services to borrowers—a factor that has contributed to its mortgage growth in the past few years.
Shares of CIBC are down 3.6 percent in 2017, but the bank has reported a 9-per-cent increase in net income (up to $1.17 billion) due to reliable retail business performance, making up for a weaker capital markets division.
Related stories:
Too much tightening
Higher BoC rate could draw out Toronto’s housing slowdown – CIBC’s Tal
