With the housing market slowing, consumer debt at a record high and signs of weakness in business investment, everybody’s scratching their heads wondering where Canadian banks’ record profits are coming from.
Despite downgrades by S&P and Moody’s ratings agencies and warnings from market analysts, Canada’s Big Five banks surprised observers with stronger-than-expected earnings last week.
Scotiabank was the last to report, announcing last week it had $1.625 billion in unadjusted net income in the first quarter of its fiscal year. RBC reported $2.07 billion in net income; TD recorded $1.79 billion; BMO had a net income of $1.048 billion; and CIBC reported the weakest results of the bunch, with a profit of $798 million.
That’s a lot of profit for three months of work — $7.331 billion in all, by our calculations.
How much money, exactly, is that? To help wrap our heads around it, here are some things that $7.3 billion will buy you:
