Bitcoin needs more 'institutional support' before we jump in: Ontario Teachers' CEO
The head of the Ontario Teachers’ Pension Plan isn’t concerned that mortgage issues at Home Capital Group and Laurentian Bank are signs of an endemic problem with the Canadian banking system.
In an interview on BNN, Teachers’ CEO Ron Mock said both problems were company-specific, and shouldn’t be taken as a sign the industry suffers from lax underwriting standards or insufficient regulatory oversight.
“The regulators are very aware of this, they’re very focused on it, and they’ve got their finger on that pulse,” he said. “The six major banks in Canada are much, much, much bigger than either [Home Capital Group and Laurentian Bank]. Canadian market stability and our large Canadian banks are well-run and solid, so I see no issues.”
Concerns over Laurentian’s plan to repurchase mortgages that were deemed to have “documentation issues and client misrepresentations” last week evoked fresh concerns about the Canadian mortgage market, though the bank’s chief executive, François Desjardins said the loans were performing in line with the rest of his book.
If anything, Mock said the more substantial risk to the big Canadian banks is a hit to their reputations stemming from missteps at the smaller lenders, if investors decide to paint the entire sector with a broad brush.
“What I think that we need to be a little careful of is that when some of the smaller institutions find themselves in this circumstance, that it doesn’t actually impact the larger banking sector from a … knock on effect, because we saw that when we had Home Capital,” he said.
“I don’t think it’s appropriate because our banks here in Canada are very, very-well managed.”