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Still, some borrowers have fallen behind on their debt payments following a deferral. More could follow suit as the pandemic drags on.
“It is too soon to be definitive, though, especially about mortgages,” Bank of Canada Deputy Governor Toni Gravelle said in a Nov. 23 speech, according to a transcript. “Many mortgage deferrals ended only in October, so we may not have a full picture of how many homeowners have fallen behind on those payments until the end of the year or early 2021.”
It is too soon to be definitive, though, especially about mortgages
Bank of Canada Deputy Governor Toni Gravelle
However, the decline in deferrals comes as Canada’s Big Six banks are seeing their earnings impress again, after they were hit earlier this year by the pandemic and its associated economic effects. Those conditions prompted banks to build their loan-loss reserves, eating into their profits, and as interest-rate cuts by central banks put pressure on lending revenue.
TD reported on Thursday an 80-per-cent increase in profit for its fourth quarter compared to a year earlier, to $5.1 billion, as the lender booked a $2.3-billion after-tax net gain tied to the Charles Schwab Corp.’s acquisition of TD Ameritrade Holding Corp.
Before that US$22-billion deal, TD had owned approximately 43 per cent of TD Ameritrade, an Omaha, Neb.-based broker. It now owns around 13.5 per cent of Schwab, a San Francisco-headquartered financial-services firm.
When adjusted for the TD Ameritrade deal, TD’s net income was up one per cent for the three-month period ended Oct. 31, to just shy of $3 billion. Even so, the bank’s adjusted earnings per share were $1.60, up one cent from a year earlier and above the $1.28 consensus estimate among banking analysts.
