NEW YORK, NY--(Marketwire - Jan 30, 2013) - Despite being ranked among the soundest in the world by the World Economic Forum, the long-term credit ratings of six Canadian banks were recently downgraded by Moody's Investors Service. Just last week, the Bank of Canada lowered its 2013 growth forecast to 2 percent from the 2.3 percent forecasted in October. Research Driven Investing examines investing opportunities in the Canadian Banking Industry and provides equity research on The Bank of Nova Scotia (
Bank of Montreal, Bank of Nova Scotia, Caisse centrale Desjardins, Canadian Imperial Bank of Commerce, National Bank of Canada and Toronto-Dominion Bank has their credit ratings downgraded one notch Monday. According to Statistics Canada, in the third quarter of 2012 Canadian consumer debt grew to a record high of 165 percent of disposable income, compared to 137 percent in mid-2007. Rising house prices, which have gained roughly 20 percent since November 2007, have been a major factor in the rise of consumer debt.
"High levels of consumer indebtedness and elevated housing prices leave Canadian banks more vulnerable than in the past to downside risks the Canadian economy faces," David Beattie, vice-president at Moody's, said in a note.
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Scotiabank is one of North America's premier financial institutions and Canada's most international bank. Scotiabank and its affiliates serve some 19 million customers in more than 55 countries around the world. For the full year 2012 Scotiabank reported a record net income of $6.46 billion, a year-over-year increase of 21 percent.
Royal Bank of Canada is one of Canada's largest banks as measured by assets and market capitalization, and is among the largest banks in the world, based on market capitalization. Royal Bank was the only one out of the big six Canadian banks to have not been downgraded. The company is scheduled to release its first quarter fiscal 2013 results on Thursday, February 28th.
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