MSN published a Vancouver Sun article quoting Thomas Davidoff, a UBC economist, about Canadian banks’ exposure to loans backed by residential real estate.
An analyst looked at all six major Canadian banks and found that exposure to loans supported by residential real estate was $1.1 trillion at the end of April 2016.
Loans made by Canadian banks, all together, to residential real estate mortgages account for about 47 per cent of their total, and just over half of those are uninsured.
“Residential mortgages are a huge part of the financial economy,” Davidoff said. “In a downturn, at minimum, many lenders lose a source of profits and could lose money servicing and taking losses on defaults.
