INTRODUCTION
The Bank of Nova Scotia, commonly referred as “Scotiabank,” is one of the largest banks of Canada. It was founded in 1832 in Halifax by local merchants and citizens. They wanted a public bank, owned by shareholders and authorized by the government and that could provide currency for trade and transactions. The bank operates in three business lines: personal banking, commercial banking, and wealth management.” Scotiabank trades on the Toronto Stock Exchange as “BNS”. It serves 23 million customers with a team of more than 88,000 employees and assets of $896 billion (as at October 31, 2016) (scotiabank, n.d.) According to (Bonham, 2010) “Scotiabank has established itself as Canada’s most international bank through extensive
…show more content…
Despite the quick growth in the Interest rate household will have slow impact. “The Bank of Nova Scotia’s homeowners who have locked in a fixed-rate mortgage will not ascertain the change until the fixed term ends and it's time to renew, but in terms of those who use their homes as a source of cash by borrowing against their home equity could quickly owe more now that interest rates have risen, as those loans are frequently variable rate.” (The Bank of Canada, 2017)
Downside risks
A recent study by Moody’s (Moody's, 2017) stated that “Debt held by consumers and private businesses in Canada has ballooned to 185 per cent of GDP at the end of 2016, up from 179.3 per cent in 2015.” It can be taken as a lot of additional debt in a short period of time and Continued growth in debt and elevated housing prices leaves consumers, and Canadian banks, more vulnerable to downside risks facing the Canadian economy than in the past.
The Bank of Nova Scotia will not be aloof of this situation. The share price was the highest at 23rd Feb 2017 i.e. CAD$ 81.89 but now it is gradually decreasing. The downside risk is going to have a negative impact over all the Canadian economy. Scotiabank plans to counter this risk by stabilizing inflation expectations and strong investment intentions (Scotia Bank,
…show more content…
While the bank's strategic actions were intended to enhance current profitability - in 2016, Scotiabank reported domestic net interest margin lower than the six largest Canadian banks' average. (scotiabank, n.d.).However, the future is changing. The increased in the interest rate has created an opportunity to overcome the margin pressure for all the Canadian banks.
BIBLIOGRAPHY
Bonham, M. S. (2010, 03 05). The Canadian Encyclopedia. Retrieved from www.thecanadianencyclopedia.ca: http://www.thecanadianencyclopedia.ca/en/article/bank-of-nova-scotia/
Castaldo, J. (2017, July). MACLEANS. Retrieved from Macleans.ca: http://www.macleans.ca/economy/economicanalysis/what-higher-interest-rates-mean-for-real-estate-debt-and-the-economy/
Moody's. (2017). Retrieved from www.moodys.com: www.moodys.com
Rate Hub. (2017). Retrieved from Ratehub.ca: https://www.ratehub.ca/best-mortgage-rates/5-year/fixed
Ratner, J. (2017, July 11). The Financial Post. Retrieved from http://business.financialpost.com/investing/canadian-banks-stand-to-gain-from-interest-rate-hike-but-some-more-than-others scotiabank. (n.d.). Scotia Bank. Retrieved from scotiabank.com: http://www.scotiabank.com/ca/en/0,,464,00.html
The Bank of Canada. (2017). Retrieved from CBC.ca:
The global economy has been recovering from the financial crisis which occurs in 2008, then has a weak growth for most developed countries over 2012 and 2013. But economic activity in Canada has expanded at a faster pace than most other major advanced countries in 2012; however, economic performance in Canada has been unsteady throughout 2013 (The Economic review, 2013). After the last quarter in 2010 GDP growth rate grows rapidly, the GDP grows slowly but steadily in 2012 which remains at around 3 percent. Real GDP growth rate in Canada grows slowly in the first quarter of 2013, but increased by 5 percent in the second quarter ,then remains the same level until the first quarter of 2014 (Statistics Canada, 2014). In 2014, the Canadian government take a series economic action plan as a guide for the economy development such as improving investment conditions, ...
National Bank of Canada ("NBC" or "the Bank") is tasked with the decision to review Dawson Lumber Company Limited's ("Dawson") request for an increase in its line of credit up to the amount of $10.8mm. Dawson intends to finance inventory and receivables with the line of credit. NBC must remain cognizant of the competitive landscape of the lumber industry and assess whether a focus on the retail segment is beneficial to Dawson's strategic plan. Given that Dawson is one of the region's largest borrowers, NBC must be careful in how it manages this relationship. The Bank cannot afford to turn away NBC's business. However, extending Dawson additional credit may increase Dawson's default risk and jeopardize the potential for NBC to retrieve the $4.2mm term loan it is already owed.
Library and Archives Canada. "ARCHIVED - Leading Canada-First Among Equals."ARCHIVED - Leading Canada-First Among Equals. N.p., n.d. Web. 22 May 2014.
Central Intelligence agency , "Canada ." Last modified November 12, 2013. Accessed November 27, 2013. https://www.cia.gov/library/publications/the-world-factbook/geos/ca.html.
but every center in Western Canada was giving their paper to an operation site in Montreal
United States. Federal Reserve Bank of New York. Quarterly Report on Household Debt and Credit. 2013. Web.
Not only is this a sign of an unstable economy and a poor handing out of loans overall, this is happening right now in Canada. “Canadian personal debt remains at record levels as well. The average Canadian household owes $1.64 for every dollar in disposable income. This is higher than the peak in the same ratio from the United States back before its housing market collapsed,” according to Fool.ca. Not only can this be attributed to Canadians themselves but foreign investors. “Foreign buyers–mainly Chinese nationals–were desperate to get capital out of China. Many of them bought Canadian real estate not as an investment, but as a store of value. With China’s main stock index plunging daily, much of this wealth is now disappearing. This combined with oil’s weakness now really being felt around the country could bode very poorly for Canadian real estate in 2016”. Every single day foreign buyers, mostly Chinese nationals are buying up space and homes in Canada at ridiculous prices to store value. This influx of wealthy Chinese people moving to Canada can be seen in schools all throughout the country. Small cracks in the structure have already been seen in Alberta where prices in Fort McMurray have fallen by more than 100,000$. The author of the article “Why 2016 could be the year Canada’s housing bubble bursts” says “
Canadian delegates were placed in charge of four core areas in the reformation of financial policy and, “in all these areas, Canada was able to successfully push for reforms that resonated with its experiences and interests in enhanced financial sector regulation and supervision.” This crisis, and the successful reformations that came out of it, further installed Canada as a leader in economics, firmly inaugurating them as the world’s best bankers. During World Wars I and II, Canada had no formal military. Canadian soldiers, whether volunteers or conscripted, were trained and led by the British military. Although Canada had their own units, these were treated as an extension of the British military, not as an independent, Canadian branch.
People outside of Canada are baffled at how Canada ended up in such a state of affairs. Canada as a country has a lot going for it. A high GNP, and high per capita income in international terms. It is ranked at the top of the...
Drew, Kathryn. “Stock Highlight: priceline.com.” Value Line. Value Line, 29 May 2013. Web. 25 March 2014.
The early decades of the nineteenth century saw the establishment of banks in the Caribbean largely as a convenience for the local governments. Throughout much of the nineteenth century, most Caribbean banks operated as an oligopoly with limited government influence – this directly translated into higher profits. However, over time, the banking environment could best be described as complex and dynamic. Competition increased, resulting into greater need for improved customer service, product innovation and cost reduction strategies. In order to achieve this, the banking sector was undergoing major structural reforms characterized by mergers and acquisitions. On July 23, 2001 Barclays and CIBC announced that they were in advanced discussions which were intended to lead to the combination of their retail, corporate and offshore banking operations in the Caribbean.
In terms of looking at how credit rating agencies affected the market as a whole, they played a role within the mortgage crisis as they gave way to a real estate credit bubble. The mortgage crisis seems to have b...
...our weeks ago it was down to 5%. It is now currently 5.24%, which is a big jump for only four weeks. Mortgages are through banks, so that is money they are losing since it is so low right now. Credit card interest rates need to drop so mortgages can get back to where they were. It is more expensive for the people, but it would compensate for credit cards.
I was given the task to make an assignment on the subject of Business Information Management. In this assignment, I have to read and analyse a case study entitled RBS failure caused by inexperienced computer operative in India. After that, I need to make a summary of this case study because it shows what I understand in this case study. Besides that, the objective of this case study is to know the factors that have caused the system failure at Royal Bank of Scotland. The reason I want to know this factor because Royal Bank of Scotland (RBS) has faced computer meltdown with the loss of its share price as well as millions of customers unable to access their account.
In this case study it was stated that there were a problem happen in the outsourcing for the Royal Bank of Scotland. What happen was there were an error that happen during the routine software upgrade that cause million of that bank customer cant access to their account. The error happen when one junior technician in India was accidently wiped all the information during the routine software upgrade. The member of staff that was working under the program for the Royal Bank of Scotland, NatWest and Ulster Bank and it was based in Hyderabad, India.