Canada's major bank CEOs are urging the federal government to address internal trade barriers, assess tax policies, and review regulations, as the top lenders in the country voiced concerns that trade risks are impacting the economic outlook.
The six major Canadian banks, monopolizing over 90% of the banking market and ranking among the largest publicly listed firms in Canada, surpassed analysts' first-quarter profit projections. However, they also allocated significant funds to safeguard against bad loans amidst economic uncertainties.
During earnings calls this week, the bank CEOs echoed similar sentiments. U.S. President has declared intentions to levy 25% tariffs on most Canadian imports on March 4.
Addressing this, Kevin Burkett, a portfolio manager at Burkett Asset Management, observed, "The bank CEOs have a voice and are pushing for a reduction in regulatory burden." His firm holds shares in Bank of Montreal, Royal Bank of Canada, and TD Bank.
The proposed tariffs by Trump could substantially impede growth, result in job losses, and elevate prices of various goods in the U.S. and Canada, considering that Canada exports about 75% of its goods to the U.S.
TD Bank CEO Raymond Chun emphasized the need for Canadian governments and businesses to collaborate in eliminating barriers hindering national productivity and boosting competitiveness.
Royal Bank of Canada CEO Dave McKay highlighted, "This is Canada's opportunity to enhance economic productivity and competitiveness, driving future growth with significant benefits for Canadians amid this uncertainty."
National Bank of Canada CEO Laurent Ferreira urged Ottawa to appoint a "head of deregulation" to cut through "unproductive red tape," lessening regulatory burdens for businesses, and safeguarding Canadian ownership.
While Canadian banks have sought growth outside the country, focusing on U.S. retail expansion, three of the top six have diversified their retail businesses in the U.S.
Bank of Nova Scotia, after scaling back in South America, has targeted investments in U.S. regional lender KeyCorp, with a strategy relying on increased trade among the U.S., Canada, and Mexico. CEO Scott Thomson stressed the importance of elevating investment, embracing energy policies to boost oil and gas exports, and expediting the development of natural resource projects.
Lastly, Bank of Montreal CEO Darryl White noted that clients on both sides of the border are displaying more caution regarding capital deployment.