Despite slowing economic growth, Canada is in little danger of a recession this year, Bank of Montreal CEO Darryl White argued.
“Are we experiencing some slowdown? Yes, but let’s pay attention to the rate of change... It’s moderating, it’s not a screeching halt,” While told The Canadian Press right after the annual meeting of the bank’s shareholders earlier this week.
“And when we look at employment rates, we look at inflation, they don’t line us up to driving ourselves towards a recession.”
White projected that by the end of 2019, Canada’s GDP growth will be approximately 1.5%.
During the meeting, White also noted that the moderation in Canada’s consumer loan and mortgage volume is both “healthy and expected,” with credit quality in these spaces remaining “very good” and net growth being starkly apparent despite regional variances.
Any slackening exhibited by B.C., Alberta, and Saskatchewan are offset by robustness in Toronto. Markets in Southern Ontario apart from Toronto, combined with Ottawa and Montreal, are showing much of the mortgage market’s strength.
“You really have a diverse set of circumstances when you go across the country... On a blended basis across Canada, are we going to see a slowing consumer mortgage portfolio? For sure, relative to what we would have seen last year or the year before. But still growing,” White assured.
The executive added that BMO’s mortgage portfolio is 44% insured, while the uninsured portion has a greater than 50% loan-to-value ratio.
“I don't lose sleep over this question, personally... I think the market is a lot healthier than some people think it is.”