CIBC warning on risky lenders

CIBC warning on risky lenders

CIBC warning on risky lenders The shadow lending market is growing as tighter regulations force the major banks into tighter controls. The Bank of Canada raised concern on the growth of unregulated lenders, sometimes attached to the pay-day loan sector, last year and now an economist from CIBC World Markets has expressed his doubts. Benjamin Tal told The Financial Post that increased regulations on the major lenders is likely to increase the margin between them and the shadow market. He explained: “If you are a regulator, and you are imposing more and more regulations on those that are regulated, those financial institutions cannot do all the business that they want to do.” That, he said, would push more borrowers towards the unregulated sector and increase the risk in Canada’s credit profile. Read the full story.
 
4 Comments
  • Dave 2015-02-19 8:51:53 AM
    Meanwhile the banks have completely different rules than broker lenders and their own 'shady' deals are being done. Whole industry is run by the banks , not the government.
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  • Hugo Dos Reis 2015-02-19 10:12:24 AM
    Interesting to hear this from CIBC. I had reviewed a deal for a client that couldn't get done on the "A" side without a co-borrower. Client advised he took it to CIBC and they made it work, despite the ratios being completely off... Not the first time either i've lost something to CIBC. Some of these branch sales people have their own authorization limits, so deals are getting pushed through that shouldn't be.
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  • John Woods 2015-02-19 2:17:14 PM
    Even though I have a great deal of respect for Mr. Tal, the age old expression "people in glass houses should not throw stones" comes to mind.
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