New market study, "Canada Commercial Banking Report Q2 2011", has been published

April 8, 2011 - PRLog -- Moderation Going Into 2011  Our core view that Canadian lending and asset growth would moderate toward the end of 2010 and into  2011 is playing out. Loan growth contracted on a year-on-year (y-o-y) basis between March and  September 2009, then rebounded to a peak of 8.6% y-o-y growth in May 2010 before the pace of credit  expansion slowed to 5.9% in September. It should continue to decrease as consumers moderate their  activity and mortgage demand slows at the start of 2011. Compared with a five-year compound annual  growth rate of 12.5% by 2008, we estimate that loan growth declined to 5.0% in 2010 (a downward  revision from 7.5% in our previous report) and will be 5.5% per year over the remainder of the forecast  period to 2015. The loan-to-deposit ratio is very manageable and is set to decline further over the coming  five years.    We emphasise that our outlook represents a moderation rather than a collapse and that it is more demanddriven  than supply-driven. Household debt as a percentage of personal disposable income has risen to an  all-time high of nearly 150%, close to levels prevailing in the US. While this should not be a problem so  long as house prices avoid collapse (our base scenario is for a moderation in prices) and levels of  household financial stress remain fairly low, it suggests that debt is being pushed to the limit. Our forecast  also takes into consideration our macroeconomic projection of more interest rate hikes by the Bank of  Canada from the end of Q111, which will dampen credit demand. On the corporate side, investmentdriven  loan growth will be relatively strong and according to the Bank of Canada's October 2010 Senior  Loan Survey, lending conditions to businesses have eased significantly. However, as business loans only make up about 20% of lending, even a sustained surge in corporate lending would only push up the level  of aggregate loans at the margins.  Banks On Solid Ground Going Into 2011  With Q410 financial year earnings for Canada's major banks yet to be published at the time of writing, we  anticipate that the financial statements will reflect a slowing in loan growth and moderating profits, as  reflected in our top-down forecasts for weaker asset expansion. We also expect a continued reduction in  loan loss provisions as the economic recovery has fully taken hold. The big change in 2011 from a  corporate financing perspective will be the rise of dividend payments, following the Office of the  Superintendent of Financial Institutions' declaration in September 2010 that it 'will no longer require the  increased conservatism in capital management' that was made mandatory during the financial crisis. This  is reflective of the excellent shape that Canadian banks find themselves in, in contrast to many European  and US banks that continue to suffer from the fallout of the recession.    We do not believe that dividend payouts to shareholders will materially hurt Canadian banks' ability to  meet regulatory requirements, let alone affect their solvency. In our view, Canadian banks are likely to  meet and exceed the new Basel III requirements prior to the implementation deadline in 2019 (please see  our Q111 Global Banking Sector Outlook for for more on the regulations), even with much more  stringent specifications for capital bases.

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Partial Table of Contents:

Executive Summary
- Table: Levels (CADbn)
- Table: Levels (US$bn)
- Table: Levels At December 2010
- Table: Annual Growth Rate Projections 2011-2015 (%)
- Table: Ranking Out Of 59 Countries Reviewed In 2011
- Table: Projected Levels (CADbn)
- Table: Projected Levels (US$bn)
SWOT Analysis
- Canada Commercial Banking SWOT
- Canada Political SWOT
- Canada Economic SWOT
Business Environment Outlook
- Commercial Banking Business Environment Ratings
- Table: Canada's Commercial Banking Business Environment Rating
- Commercial Banking Business Environment Rating Methodology
- Table: Developed States Commercial Banking Business Environment Ratings
Global Commercial Banking Outlook
- Regional Outlooks
- Mergers And Acquisitions Outlook For Banks
- Table: Banks' Bond Portfolios, 2009
- Table: Commercial Banking Business Environment Ratings
- Table: Comparison Of Loan/Deposit, Loan/Asset And Loan/GDP Ratios
- Table: Anticipated Developments In 2011
- Table: Comparison Of Total Assets, Client Loans And Client Deposits, 2009-2010 (US$bn)
- Table: Comparison Of Per Capita Deposits, 2010e (US$)
- Table: Interbank Rates And Bond Yields, 2010-2011
Canada Banking Sector Outlook
Economic Outlook
- Table: Canada Economic Activity, 2006-2015
Competitive Landscape
- Market Structure
- Protagonists
- Table: Protagonists In Canada's Commercial Banking Sector
- Definition Of The Commercial Banking    Universe
- List Of Banks
- Table: Domestic Banks
- Table: Foreign Banks - Lending Branches
Company Profiles
- Royal Bank of Canada
- Table: Stock Market Indicators
- Table: Balance Sheet (CADmn, unless stated)
- Table: Balance Sheet (US$mn, unless stated)
- Table: Key Ratios (%)
- Toronto-Dominion Bank
- Table: Stock Market Indicators
- Table: Balance Sheet (CADmn, unless stated)
- Table: Balance Sheet (US$mn, unless stated)
- Table: Key Ratios (%)
- Bank of Montreal
- Table: Stock Market Indicators
- Table: Balance Sheet (CADmn, unless stated)
- Table: Balance Sheet (US$mn, unless stated)
- Table: Key Ratios (%)
- Bank of Nova Scotia
- Table: Stock Market Indicators
- Table: Balance Sheet (CADmn, unless stated)
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Full Table of Contents is available at:
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Fast Market Research is an online aggregator and distributor of market research and business information. We represent the world's top research publishers and analysts and provide quick and easy access to the best competitive intelligence available.