Fitch warns of interest rate rises as banks face risk

Basic RGB

Concern over the lower profits of banks amid tougher global economic conditions could mean higher interest rates in Canada. Ratings agency Fitch says that auto loans and credit cards present the main risk of delinquencies, especially in the oil producing areas. Household debt may need to be cooled with rising interest rates.

Canadian banks have been subjected to lower regulatory conditions than US and European counterparts and are viewed by some analysts as riskier. Currently Fitch says that Canada’s lenders are able to withstand headwinds but that could change, especially if energy firms continue to be impacted by lower prices.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s