Wednesday , July 24 2019

Scotiabank CEO scorns US funds shorting Canada banks

Bloomberg

Shorting Canadian banks has long made for a poor bet by US hedge funds, and this time will be no different, according to Bank of Nova Scotia Chief Executive Officer Brian Porter.
“US hedge funds, from time to time, have appeared in this country over the last 10 years with the same hypothesis of shorting Canadian banks, and it hasn’t worked well for them,” he said at the company’s annual meeting in Toronto in response to an investor’s question.
While Porter said “there’s clearly a concern out there about the state of the Canadian housing market,” no hedge funds have talked to Scotiabank about the company’s assets or balance sheet. The bank said its Canadian residential mortgage portfolio is about C$216 billion ($162 billion), with 42 percent of those home loans insured,
and an average loan-to-value ratio of 55 percent for its uninsured mortgages.

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