# CDN Banks: Thoughts?



## d333gs (Apr 21, 2020)

Of interest from the Finacial Post








Canadian bank short-sellers finally saw the 'Great White Short' pay off in March


Short-sellers were up almost $2.61 billion, or 26.32 per cent mark-to-market, from March 1 to Tuesday morning




business.financialpost.com





Just looking at the BMO chart ......oh boy : being below the purple trend line and red Chanel is ugly. 

Here is the chart I am looking at: BMO - Bank Of Montreal


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## d333gs (Apr 21, 2020)

Any chart requests are welcome. 
I hope we can get some fundamental insights to CDN Banks


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## Eder (Feb 16, 2011)

My BMO position was established at ~$35/share years ago when again it was going to zero. Charts are good at hindsight.


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## d333gs (Apr 21, 2020)

Thanks for the insight Eder


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## d333gs (Apr 21, 2020)

Interesting from The Motley Fool








Canadian Bank Stocks: What Now?


Canadian bank stocks are finally coming back up, but is now the time to buy? Or should you wait out the storm?




www.fool.ca


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## newfoundlander61 (Feb 6, 2011)

I laughed this morning at the BNN headline regarding RY 's earnings results, a little excited they got.

"RBC *smashes* Q1 profit estimates as mortgage book tops $300B"


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## AltaRed (Jun 8, 2009)

Those who make fun of Canadian banks, and there were a lot of them at various times over the years including last Spring/Summer, usually get 'foot in mouth' disease.


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## cainvest (May 1, 2013)

Most banks are gaining pretty good and beating estimates.
For Feb CM up 6%, BNS up almost 10%


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## newfoundlander61 (Feb 6, 2011)

I purchased my 3 cdn banks TD; BNS, & RY in fall of 201.With the dividends and still holding them all, this area of my portfolio is doing just fine.


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## doctrine (Sep 30, 2011)

I have owned most Canadian banks for more than a decade. In 2020, I added to BMO @ $70 (+54%) and $63 (+70%), BNS at $50 (+52%), CIBC at $78 (+50%), and Royal Bank at $87 (+29%). Haven't added any since May but on the whole, they look very good and still not overpriced given historical valuations. But probably fairly valued.


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## dubmac (Jan 9, 2011)

over the past year, banks are the ones that you just hold your nose and buy when prices dropped to where they were in March-May 2020. Oil (WCP) has also bounced back nicely. WCP was trading at 0.72 11 months ago!, up around 6 now)
At the same time tho seems that when banks bounce higher, more & more alarms are raised about the degree of consumer debt - not a surprise really - but I'm seeing alot of headlines that focus on overheated housing markets (at least here in Vancouver, and likely Toronto). If rates go up......then.....
oil price & banks & consumer debt - all three seem strongly correlated.


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## Retiredguy (Jul 24, 2013)

I have long held positions in TD, RY, BMO. Some TD and RY dating back to the 1980's. I bought CM at 89.39 about 8 days too early this past March. In addition to whatever it's trading at (117.00?) I've collected 5.84 in divs. So while I didn't hit the low I'm enjoying the comfort that I still hit the buy button when I did. Expectation of nice div increases eventually returning to us sinners, who DO UNDERSTAND, that's not free money .


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## Tostig (Nov 18, 2020)

AltaRed said:


> Those who make fun of Canadian banks, and there were a lot of them at various times over the years including last Spring/Summer, usually get 'foot in mouth' disease.


Remember that time in the past when the international business community was lecturing at Canada saying we weren't aggressive enough?

Then when the 2008 financial crisis hit, our banks ended up looking pretty good.


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## newfoundlander61 (Feb 6, 2011)

RY earnings were very positive but stock was down maybe due to the recent increase in its price some profit taking was in order. Going forward the banks should be just fine with the odd bump in the road from time to time.


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## agent99 (Sep 11, 2013)

newfoundlander61 said:


> RY earnings were very positive but stock was down maybe due to the recent increase in its price some profit taking was in order. Going forward the banks should be just fine with the odd bump in the road from time to time.


Some of the "experts" are predicting that banks will do well going forward as Covid abates. Other businesses too that will benefit from release of pent up consumer demand. Other sectors like utilities/telecoms may not see as much growth, but should still churn out those dividends! But who really knows.


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## Retiredguy (Jul 24, 2013)

Thoughts on (ETF) HCAL ?


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## agent99 (Sep 11, 2013)

Retiredguy said:


> Thoughts on (ETF) HCAL ?


1.25X leveraged. If I wanted leverage, I guess I would just do that in our margin account? I don't know all the deatails - does it offer any other "features"? Less expensive than paying brokerage margin interest?


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## Retiredguy (Jul 24, 2013)

There is also HCA which is not leveraged.

(Cut and paste from their site) ...The fund is designed to track the Solactive Canadian Bank Mean Reversion Index TR, which invests 80% in the three most oversold Canadian banks in the previous month, and 20% in the three most overbought. The portfolio is rebalanced every month. What is Mean Reversion? Over the years, buying the laggards and selling the winners at the end of each month has proved to be a winning strategy, driven by the tendency for Canadian banks — over the long run— to generate similar returns.

Both HCA & HCAL have monthly divs/distributions. I can't find clarity on their sites that the distributions are eligible divs.

Mer for HCAL is .65 HCA is .45 I believe.


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## robfordlives (Sep 18, 2014)

Retiredguy said:


> I have long held positions in TD, RY, BMO. Some TD and RY dating back to the 1980's. I bought CM at 89.39 about 8 days too early this past March. In addition to whatever it's trading at (117.00?) I've collected 5.84 in divs. So while I didn't hit the low I'm enjoying the comfort that I still hit the buy button when I did. Expectation of nice div increases eventually returning to us sinners, who DO UNDERSTAND, that's not free money .


Thankfully no BNS for you like myself. Trading at July 2014 levels lol. A complete and utter joke of a company with failed strategy they keep pursuing.


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## Ponderling (Mar 1, 2013)

So back in 2008 I found an early precursor to etfs. I think it was called a TIPS. I put 40K into the TIPS Canadian bank index a few days after the crash of Bears Stearns and Goldman's debacle when it seemed everyone was expecting every bank to collapse. I sold out of that vehicle about 9 month later 20K richer.

This time around in april may 2020 I put extra cash into my big bank holdings, except for the stinker LB, which was sold to capture the capital loss to counter gains I had accrued in Feb 2020 trades. 

For Canada I buy individual stocks. I dont like broad cdn index etf's, as you end up overweight in financial services stocks. I keep finaniacal services to 10% of my Canadian stock holdings.


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## Eclectic12 (Oct 20, 2010)

OOH ... TIPS was early as the first one was created in '89.
OTOH ... XIU started in '99 so it wasn't a long lived lead.

I'm pretty sure the "2008" is off the mark as the G&M in Feb 2000 talks about how TIPS was going to cost the TSX more than two million when TIPS was moved to the S&P/TSX indexes the following month. From what I recall and the articles I can find - TIPS hasn't existed in almost twenty years.

As for me, I bought BMO in late Feb/early March 2009 when it was yielding IIRC 10%, for about $30.


Cheers


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## fireseeker (Jul 24, 2017)

Eclectic12 said:


> OOH ... TIPS was early as the first one was created in '89.
> OTOH ... XIU started in '99 so it wasn't a long lived lead.
> 
> I'm pretty sure the "2008" is off the mark as the G&M in Feb 2000 talks about how TIPS was going to cost the TSX more than two million when TIPS was moved to the S&P/TSX indexes the following month. From what I recall and the articles I can find - TIPS hasn't existed in almost twenty years.


TIPS (TSE 35) and HIPS (TSE 100) were combined to become XIU (TSX 60). I owned HIPS at the time of the transition.
Blackrock still touts XIU's history from its TIPS/HIPS days.



> Started trading in 1990, making it the first ETF in the world


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## agent99 (Sep 11, 2013)

robfordlives said:


> Thankfully no BNS for you like myself. Trading at July 2014 levels lol. A complete and utter joke of a company with failed strategy they keep pursuing.


Above type of comment encouraged me to have a quick look at the banks today. We own all 6. First just looked at 5 year stock price performance as of closing today.

Figures in blue/red added are Annualized return with/without divvies reinvested (for us retirees!). 

BNS $59,5-->$75.55  +26.9% 10.24% 9.44%
CM $92.76-->$118.66 +27.9% 10.61% 9.54%
BMO $76.21-->$106.1 +39.2% 11.04% 10.17%
TD $53.67-->$77.77 +44.9% 12.02% 11.18%
RY $71.38-->$109.74 +53.7% 13.3% 12.52%
NA $37.33-->$80.3 +115% 21.13% 19.59%

No bad ones really! But National Bank the winner by a country mile!


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## Eder (Feb 16, 2011)

So the question is...should we be buying BMO at $106? It might be $106 in 2031. Should we wait for the often 25% pullbacks it undergoes to buy? How do we know banks are a buy?

I usually use the dividend yield to go/no go on adding banks. I added my most recent bank position when TD was yielding well over 5%. At today's 4% I dunno. BMO I'd want 6% to add. Momentum types will disagree but I'm most likely never selling any banks so I hate to pay too much.

So ya if you bought BNS 7 years ago for today's price you paid too much....if you bought BNS today my opinion it is a better buy than 2014 but not great.


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## Tostig (Nov 18, 2020)

Between all of my and my wife's brokerage accounts, we both own all the bank stocks except RY. Not sure why. Guess I every time I try to build a bank portfolio, RY always seemed high in comparison to another.

And then I learned about ZEB which is a bank ETF that contains all the big six banks at equal weights.

The only disadvantage with ZEB is that if you own only ZEB, you can't read the shareholder proposals that appear in each bank's annual proxyvote to support them.


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## Gator13 (Jan 5, 2020)

Tostig said:


> Between all of my and my wife's brokerage accounts, we both own all the bank stocks except RY. Not sure why. Guess I every time I try to build a bank portfolio, RY always seemed high in comparison to another.
> 
> And then I learned about ZEB which is a bank ETF that contains all the big six banks at equal weights.
> 
> The only disadvantage with ZEB is that if you own only ZEB, you can't read the shareholder proposals that appear in each bank's annual proxyvote to support them.


And of course, ZEB comes with a 0.61% MER. I prefer to own the bank stocks directly.


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## agent99 (Sep 11, 2013)

Gator13 said:


> And of course, ZEB comes with a 0.61% MER. I prefer to own the bank stocks directly.


ZEB is equally weighted among the 6 top banks. (Not based on market cap). OK if you want your bank holdings balanced so you have the same $$ invested in BNS as say, NA or RY. So they sell the winners to buy the losers. You could do this yourself if you owned directly and at $9.95/trade say once a year, it wouldn't take much of a portfolio to beat that 0.61% MER but may suit smaller investors.

I prefer to consider each bank separately, not as a group. I am just pleased I was not selling off NA over the years to buy BNS/CM!


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## Benting (Dec 21, 2016)

I am just quite puzzle why people are so worry about overweight with bank stocks ? What % you would think is ok ?

If you dig out some of my old posts here and you probably think I am insane or crazy to have such HIGH % of bank stocks in my investment portfolio.

It is maintenence free investment for more than 25 years so far. I added more in my working years, drip and re-invest year after year. The end result is doing ok I think.


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## Retiredguy (Jul 24, 2013)

Benting said:


> I am just quite puzzle why people are so worry about overweight with bank stocks ? What % you would think is ok ?
> 
> If you dig out some of my old posts here and you probably think I am insane or crazy to have such HIGH % of bank stocks in my investment portfolio.
> 
> It is maintenence free investment for more than 25 years so far. I added more in my working years, drip and re-invest year after year. The end result is doing ok I think.


Warren Buffet says something like ... don't bet against the USA. I say don't bet against the Canadian banks.


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## dubmac (Jan 9, 2011)

I own them all. IMO they are like a foundation upon which any account can be built. I bought a different bank in each of 6 accounts. 60% of my wife's TFSA is RY. It kicks out 2K/yr alone in dividends which I re-invest in new ETF's or new stocks. the tax break helps in non-reg accounts. It's like a good dairy cow!


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## birdman (Feb 12, 2013)

Our investment portfolio is about 30% of investible asset and Cdn Banks represent 55% of our holdings. These include CM, RY, BNS, and TD. Bought my first shs of CIBC years ago at about 27.00 and are now at 120.00. Steady dividends and share appreciation and they have been in business for over 100 years and over the years have expanded worldwide and added many different segments including brokerage and insurance. Spent 35 yrs in the business and have full confidence in the sector.


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## agent99 (Sep 11, 2013)

frase said:


> Our investment portfolio is about 30% of investible asset and Cdn Banks represent 55% of our holdings. These include CM, RY, BNS, and TD. Bought my first shs of CIBC years ago at about 27.00 and are now at 120.00. Steady dividends and share appreciation and they have been in business for over 100 years and over the years have expanded worldwide and added many different segments including brokerage and insurance. Spent 35 yrs in the business and have full confidence in the sector.


In our case, banks represent about 29% of overall portfolio and about 50% of equity. Never planned it that way, but the banks have done a lot better than other dividend payers like Telecoms and utilities. I think National Bank, which we have owned for about 18 years, is our best performing stock. Up 275% while paying healthy dividend! I actually sold a bit, when things looked dire last year, as I had something to offset the gain.


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## Benting (Dec 21, 2016)

Retiredguy said:


> I have long held positions in TD, RY, BMO. Some TD and RY dating back to the 1980's. I bought CM at 89.39 about 8 days too early this past March. In addition to whatever it's trading at (117.00?) I've collected 5.84 in divs. So while I didn't hit the low I'm enjoying the comfort that I still hit the buy button when I did. Expectation of nice div increases eventually returning to us sinners, who DO UNDERSTAND, that's not free money .


Bought TD and RY in the 1980 ? Nice !
Ignore the share appreciation, have you calculate the dividend rate of return for those shares you bought in 1980 ?
The dividend for TD I bought in 1996 is almost 50% per year. I bet yours probably way over 100% ?

To me I am not too concern for the value of the stock right now. Just looking at the number of shares I own. Drip and re-invest for more from the divy. Hope the stock have few more dips like last year to get few more shares.


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## Retiredguy (Jul 24, 2013)

Benting said:


> Bought TD and RY in the 1980 ? Nice !
> Ignore the share appreciation, have you calculate the dividend rate of return for those shares you bought in 1980 ?
> The dividend for TD I bought in 1996 is almost 50% per year. I bet yours probably way over 100% ?
> 
> To me I am not too concern for the value of the stock right now. Just looking at the number of shares I own. Drip and re-invest for more from the divy. Hope the stock have few more dips like last year to get few more shares.


The positions from the 1980's were fairly small. In 1996 I bought a fairly large amount of TD on margin so used the divs to help pay it off. Still hold with 1996 ACB of $24.00 (split(s) adjusted now 6.00). the div was 1.00 in 1996 (adjusted .25 sh) so up more than 12 x. Always feel better when trading price is doing well but expect to hold until I croak. We'll enjoy another div bump later this year I think.


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## Synergy (Mar 18, 2013)

Benting said:


> I am just quite puzzle why people are so worry about overweight with bank stocks ? What % you would think is ok ?
> 
> If you dig out some of my old posts here and you probably think I am insane or crazy to have such HIGH % of bank stocks in my investment portfolio.
> 
> It is maintenence free investment for more than 25 years so far. I added more in my working years, drip and re-invest year after year. The end result is doing ok I think.


What are you puzzled about? My house has not burnt down in the last 25 yrs but I still maintain my insurance. Diversification is like a form of insurance. Both protect you from financial loss. Million dollar home, no insurance = not to bright. Million dollar portfolio with 80+% in Canadian banks = equally not to bright. I'm not sure what is so puzzling.

Past performance is no guarantee of future results!


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## agent99 (Sep 11, 2013)

Benting said:


> To me I am not too concern for the value of the stock right now. Just looking at the number of shares I own. Drip and re-invest for more from the divy. Hope the stock have few more dips like last year to get few more shares.


It's a great idea to re-invest the dividends if you don't need the cash flow. For us retirees without pensions, we just spend the divvies 

If you look at the Total return on the bank stocks, it seems that reinvesting only adds about 0.8% to the Total annual Return. Somehow I thought it would have been more. However, over the years that would make a difference.


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## james4beach (Nov 15, 2012)

Benting said:


> I am just quite puzzle why people are so worry about overweight with bank stocks ? What % you would think is ok ?


In my 5-pack, I have a 20% weight in banks. Among all my Canadian equities I'm probably around 25% banks (didn't look at exact number).

The S&P 500, which is quite well diversified, has only 14% in the financial sector.
MSCI EAFE is 17% financial sector.

So I think roughly 20% is a pretty reasonable amount in financials & banks... which is my 5-pack target.


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## Benting (Dec 21, 2016)

Bank is on the run !



Synergy said:


> What are you puzzled about? My house has not burnt down in the last 25 yrs but I still maintain my insurance. Diversification is like a form of insurance. Both protect you from financial loss. Million dollar home, no insurance = not to bright. Million dollar portfolio with 80+% in Canadian banks = equally not to bright. I'm not sure what is so puzzling.
> 
> Past performance is no guarantee of future results!


Not 80% but 99% in my currant investment portfolio with just TD and RY only ! No GIC or bond, even I have retired more than 10 years. In fact, I never have less than 70% in bank stocks since I started investment in 1996.

Didn't I say I am crazy ? Don't think anybody with sane mind would do that. But, it suits me fine. I drip and re-invest and play small amount short term bets with the dividend sometimes when I am bored. Super simple to maintain, no balancing is needed. Just sell some shares in my RIF and LIF for withdrawal at the end of the year, no matter what the stock value is,

Well, you win big or you lost big. I wouldn't recommend to anybody though....


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## Tostig (Nov 18, 2020)

On February 19th, National Bank is the first of the big six to blast through it's all time high set in February 21, 2020.
Next Royal Bank on February 19th, also passed it's all time high set in February 21, 2020 but it retreated and crossed again on March 3th.
Then came TD and BMO on March 8th.

Today CIBC came close to but retreated having never touched $125.21 set in September 20, 2018.
And finally, the laggard Bank of Nova Scotia still has $5.70 to go to reach $85.50 reached on November 21, 2017.


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## AltaRed (Jun 8, 2009)

Over the long haul, it is hard for a Canadian to not have owned the big banks as the foundation of their portfolios. They were solid 40 years ago and remain solid today. I doubt there are many, if any, other stocks on the TSX that can beat that long northeast trend. I don't care much about 1 or 2 year performance aberrations.

I suspect at least 2-3 of the banks will be the last individual stocks that I will still own (along with the S&P500) when they take me out boots first. Everything else will fall out like dominoes over time as I spend down invested capital.


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## james4beach (Nov 15, 2012)

AltaRed said:


> They were solid 40 years ago and remain solid today.


Several banks almost got wiped out in 2008, if it wasn't for significant assistance from the central banks, including *secret* liquidity support from the US Federal Reserve.

The US central bank didn't even disclose that they were supporting Canadian banks. The information came out years later, when Bloomberg's freedom of information lawsuit went to the Supreme Court. By the time it made it into media reporting five or six years later, many people had stopped caring about the episode.

What if the US Federal Reserve had decided _not_ to (secretly) support the Canadian banks?

IMO it could have easily gone differently through 2008. Depending on what government/central bank support was given, the big Canadian banks could have also been forced to issue tons of equity to recapitalize themselves, which would have hurt the stocks very badly.

Whenever I post this, people misinterpret it. I'm not saying the banks would have failed or disappeared. I'm saying that their STOCKS could have done very badly; they only did well because of extreme government bailouts / stimulus.


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## Money172375 (Jun 29, 2018)

james4beach said:


> Several banks almost got wiped out in 2008, if it wasn't for significant assistance from the central banks, including *secret* liquidity support from the US Federal Reserve.
> 
> The US central bank didn't even disclose that they were supporting Canadian banks. The information came out years later, when Bloomberg's freedom of information lawsuit went to the Supreme Court. By the time it made it into media reporting five or six years later, many people had stopped caring about the episode.
> 
> ...


I started work at TDAM a week after Lehman went broke. What a great time to join Wealth Management. We had multiple “code red” days.......come in early! Stay late! Issuing communications, interpreting markets. we would build presentations to take across the country. by the time, the presentation was to be delivered, the presenter would skip the entire presentation that was a week old because none of it was relevant anymore.

anyway...I do recall hearing our CEO speak about it years later...he said, Canadians would never know how close we came to it being all over. Kinda scary.


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## kcowan (Jul 1, 2010)

I built my bank holdings with NA first and heaviest, then TD, RY and BNS. I dumped BNS when I got concerned about their offshore holdings. Remained underweight until I recently bought CM at $113. It is now in 2nd place and I will trim until it is in 4th place. Probably beefing up RY.


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## MrMatt (Dec 21, 2011)

james4beach said:


> Several banks almost got wiped out in 2008, if it wasn't for significant assistance from the central banks, including *secret* liquidity support from the US Federal Reserve.
> 
> The US central bank didn't even disclose that they were supporting Canadian banks. The information came out years later, when Bloomberg's freedom of information lawsuit went to the Supreme Court. By the time it made it into media reporting five or six years later, many people had stopped caring about the episode.
> 
> ...


Please provide support that the US Federal Reserve bailed out Canadian banks.
Your link doesn't mention any Canadian banks (I downloaded the pdf)

Secondly in 2008 it was and is widely known that the central banks were supplying liquidity, I'm not sure about this "secret liquidity" But if you recall there was a bit of an issue in the financial markets, and they wanted to stabilize them, and liquidity was one of the major concerns at the time.
They definately didn't want a bank run in the middle of this, as such they took measures to prevent that from happening.


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## AltaRed (Jun 8, 2009)

James appears to be ragging again on the Cdn banks. The big 5 would be bailed out by the taxpayer as a last resort. Things that did change as a result of the financial crisis was to beef up Tier 1 capital requirements and make capital like prefs NVCC compliant so that certain debt holders would be converted to equity if necessary. That was a political move for optics purposes, i.e. the government of the day wouldn't want to be seen using taxpayer money to bail out banks if pref and bond holders were not required to share the pain. I repeat... there is no stock more certain than the big Canadian banks.


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## Eclectic12 (Oct 20, 2010)

MrMatt said:


> Please provide support that the US Federal Reserve bailed out Canadian banks.
> Your link doesn't mention any Canadian banks (I downloaded the pdf) ...


I didn't seen any either ... but only quickly scanned it.

The way I could see the Feds being involved with a Canadian bank is where the US subsidiary received help. 
For example, "TD Bank - America's Most Convenient Bank" instead of plan old "TD Bank". 


Cheers


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## cainvest (May 1, 2013)

AltaRed said:


> I repeat... there is no stock more certain than the big Canadian banks.


Exactly ... with government backing it's hard to see any of them lose.


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## dubmac (Jan 9, 2011)

I've never sold my bank stocks. I buy as much as I can when they turn red. Course it's all unicorns and roses now - which is great. But even when things get ugly, they do OK but just producing dividends. I have cash to deploy, but like most of you, but nowhere to put it presently (frothy market). The "green energy co's" aren;t doing as well - looks like oil/gas are back. My last purchase was FTS. As Alta suggested - banks may not always perform well, but they rarely disappoint. I sell oil stocks, but I don't sell banks. I heard that summer (July) would be a better time to buy again.


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## doctrine (Sep 30, 2011)

Banks are definitely fairly valued here. Buying stocks like BMO at $63 in May 2020 (two months after the market bottom! Hardly 'timing'!) is just such candy, but I'm not as interested at $110, although I wouldn't say it is expensive either. Financials are ultimately cyclical stocks and do not usually get above P/Es of 12. I think most of them are trading in the 10-12 range now.


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## MrMatt (Dec 21, 2011)

doctrine said:


> Banks are definitely fairly valued here. Buying stocks like BMO at $63 in May 2020 (two months after the market bottom! Hardly 'timing'!) is just such candy, but I'm not as interested at $110, although I wouldn't say it is expensive either. Financials are ultimately cyclical stocks and do not usually get above P/Es of 12. I think most of them are trading in the 10-12 range now.


I think with the current extended low interest rate environment the banks are actually undervalued.
But only because rates are so low.


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## Covariance (Oct 20, 2020)

MrMatt said:


> I think with the current extended low interest rate environment the banks are actually undervalued.
> But only because rates are so low.


Agreed. What about the recent steepening of the curve, while staying low overall. How much does that help them?


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## MrMatt (Dec 21, 2011)

Covariance said:


> Agreed. What about the recent steepening of the curve, while staying low overall. How much does that help them?


I think the entire western encomony is overleveraged.
Governments will do what they have to do, as long as it means they get votes to stay in power.

I think the banks are uniquely positioned to avoid the brunt of whatever pain comes from this.


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## AltaRed (Jun 8, 2009)

The thing is the banks are buffered by having a number of businesses which are not all affected the same at the same time. Many of the individual lumps are smoothed out by the other businesses. Retail banking rarely disappoints. Kind of like a COS portion of the pipeline business. 

I am not suggesting banks have the best long term CAGR but it is more than enough to have real growth beyond GDP and CPI. That is what one has those blue chips for....sustainability over a 30-50 year period. When I am sucking pablum through a straw someday, those bank stocks will still be spinning out cash for my POA to fund those years.


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## james4beach (Nov 15, 2012)

MrMatt said:


> Please provide support that the US Federal Reserve bailed out Canadian banks.
> Your link doesn't mention any Canadian banks (I downloaded the pdf)


I think you should go find it yourself. It will be a healthy exercise for you and @frase

Several Canadian banks borrowed huge amounts on TAF (one of the secret facilities). TD needed $28 billion, Royal $44 billion.

Look up the Federal Reserve facilities, the soup of emergency credit facilities they set up and kept secret. TALF, TAF, etc


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## james4beach (Nov 15, 2012)

cainvest said:


> Exactly ... with government backing it's hard to see any of them lose.


Government supports just means they won't fail. The equity can still get wiped out if they come on hard times.


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## Eder (Feb 16, 2011)

“Despite conspiracy theories to the contrary, there was no ‘secret bailout,’” said Flaherty spokesperson Chisholm Pothier. “Even a cursory look at the facts, readily available and published many times, indicates this report is completely baseless.”

A spokeswoman for the Canadian Bankers Association said government support was meant to help banks lend to small business, not to protect the banks from failure.


“Not one bank in Canada was in danger of going bankrupt or required the government to buy an equity stake under taxpayer-funded bailouts,” said Rachel Swiednicki.


Swiednicki said comparing the value of a bank’s shares and their participation in a government program the banks say was aimed at boosting small-business lending is like comparing apples to oranges.


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## MrMatt (Dec 21, 2011)

james4beach said:


> I think you should go find it yourself. It will be a healthy exercise for you and @frase
> 
> Several Canadian banks borrowed huge amounts on TAF (one of the secret facilities). TD needed $28 billion, Royal $44 billion.
> 
> Look up the Federal Reserve facilities, the soup of emergency credit facilities they set up and kept secret. TALF, TAF, etc


Well you're the one making the claim, without evidence.

At the time, I recall, though it was quite hazy, that all the central banks were in discussions to manage the crisis and maintain liquidity.
TAF was just one of these programs. It was part of a globally coordinated liquidity plan, not a secret bank bailout.

I'm not going to dig through piles of documents to search for a bailout that only you seem to think happened.

I think if there was a massive bailout of foreign banks, there would be some sort of controversy.


----------



## cainvest (May 1, 2013)

james4beach said:


> Government supports just means they won't fail. The equity can still get wiped out if they come on hard times.


It would have to be extremely hard times and the rest of the economy would be in a much worse state before it hit the banks IMO.


----------



## Eclectic12 (Oct 20, 2010)

james4beach said:


> ... Several Canadian banks borrowed huge amounts on TAF (one of the secret facilities). TD needed $28 billion, Royal $44 billion.


Crafty of the Federal Reserve to know that by announcing TAF in 2007 they would be able to keep it a secret by hiding in plain sight.




__





FRB: Press Release--Federal Reserve and other central banks announce measures designed to address elevated pressures in short-term funding markets--December 12, 2007


The Federal Reserve Board of Governors in Washington DC.



www.federalreserve.gov





It seems to have been a continuing theme with announcements of auctions.


https://ypfsresourcelibrary.blob.core.windows.net/fcic/YPFS/2008%2012%209%20Federal%20Reserve%20announces%20it%20will%20conduct%20two%20auctions%20of%20term%20credit%20through%20its%20Term%20Auction%20Facility%20(TAF)%20in%20January%202009.pdf



Other resources:


https://www.newyorkfed.org/medialibrary/media/research/current_issues/ci14-5.pdf










Fed Moves to Ease Strains in Credit Markets (Published 2008)


The Federal Reserve announced it was increasing the size of some cash auctions for financial institutions and the amount of dollars it provides to the European Central Bank and Swiss National Bank.




www.nytimes.com





So far, the references say the arrangements had to come from the local Reserve Bank so it's more likely the American TD bank etc.
TD and Royal would have more likely used the BoC program. 




james4beach said:


> ...Look up the Federal Reserve facilities, the soup of emergency credit facilities they set up and kept secret. TALF, TAF, etc


TALF does not seem to be secret either ... FOMC statement: Federal Reserve and other central banks announce specific measures designed to address liquidity pressures in funding markets

It seems so super secret that academics were publishing studies analyzing it in 2012.








Are the Bailouts of Wall Street Complements or Substitutes?


The Term Securities Lending Facility (TSLF) lent $2.3 trillion worth of general collateral to eighteen investment houses in exchange for riskier securities. Tre



poseidon01.ssrn.com






Cheers


----------



## james4beach (Nov 15, 2012)

Eclectic12 said:


> It seems so super secret that academics were publishing studies analyzing it in 2012.


Details of the full TAF & related program borrowings were not known until much later than 2008.

Many of these banks (including Canadian ones) required huge amounts of assistance through 2008. Without it, I'm not sure they would have survived.


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## james4beach (Nov 15, 2012)

MrMatt said:


> I'm not going to dig through piles of documents to search for a bailout that only you seem to think happened.


I gave you enough info. I'm not going to spend my night googling for info... if you care about how solvent or reliable the banks are, you should do the work yourself.


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## james4beach (Nov 15, 2012)

Eder said:


> A spokeswoman for the Canadian Bankers Association said government support was meant to help banks lend to small business, not to protect the banks from failure.
> 
> 
> “Not one bank in Canada was in danger of going bankrupt or required the government to buy an equity stake under taxpayer-funded bailouts,” said Rachel Swiednicki.


That's the lobbyist, and she's lying. A bank doesn't come along and borrow $44 billion on a secret facility (instead of the well known discount window), unless they desperately need liquidity.

During these times, banks could have borrowed at the discount window (which was already available) and also had Bank of Canada support. *In addition to those*, they also went to this secret version of the discount window, to borrow more. They borrowed through that because then the market wouldn't know they were using additional liquidity.

They were doing this to avoid the stigma of borrowing through the 'discount window'. The Canadian banks were in an extreme liquidity crunch.

They survived, yes, but an investor should be smart enough to recognize how close they came. If you have a mental block that does not make you want to see how close they came, no amount of resources I point you to can change your mind.


----------



## james4beach (Nov 15, 2012)

This is easier. Link to an old thread.

I realize that most people believe the Canadian banks were extremely solid through the last financial crisis. But I'm sure you will agree that they would have _looked even more solid_ if they didn't have to borrow/get government support for over $200 billion.

*Perhaps more relevant*: since we're all cool with the banks getting hundreds of billions of $ in liquidity support, then obviously we have no problem with Air Canada, Westjet, Sunwing, and all other airlines / travel operators, plus aerospace companies (Bombardier, CAE, etc) also getting many hundreds of billions of $ of government assistance and liquidity.

I'm comfortable with the whole thing as long as we aren't just helping banks. Airlines are just as essential as banks. @MrMatt and @Eder so will you agree it's fair for the airlines and aerospace companies to also get equivalent amounts of liquidity and free loans from the govt?


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## MrMatt (Dec 21, 2011)

james4beach said:


> This is easier. Link to an old thread.
> 
> I realize that most people believe the Canadian banks were extremely solid through the last financial crisis. But I'm sure you will agree that they would have _looked even more solid_ if they didn't have to borrow/get government support for over $200 billion.
> 
> ...


This is a duplicate post.
See my response in the Air Canada post.
Summary, I support a GM type bailout, where the insolvent company declares bankruptcy.
I don't want the executives and shareholders getting bailed out, they made a bad investment, they should lose.

As far as what companies should be supported, only those with a significant strategic interest. The others should fail.


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## MrBlackhill (Jun 10, 2020)

Still talking about our Canadian banks. My favourite bank stock is NA.

Now, why don't we talk about our other awesome Canadian stocks much more resilient than our banks? CNR, FTS, CAR-UN, EMA, TIH

Those stocks are barely affected by market crashes (compared to banks and other stocks).


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## agent99 (Sep 11, 2013)

MrBlackhill said:


> Still talking about our Canadian banks. My favourite bank stock is NA.
> 
> Now, why don't we talk about our other awesome Canadian stocks much more resilient than our banks? CNR, FTS, CAR-UN, EMA, TIH
> 
> Those stocks are barely affected by market crashes (compared to banks and other stocks).


It might be interesting to compare Total Returns with and without dividends re-invested . I have done that for some of the other blue chip stocks I own and IIRC, the banks outperformed them.

Quick look shows that some of those stocks did outperform the banks over most time frames (although NA was still up there) But they didn't all have the steady cash flow that us retirees like!


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## MrMatt (Dec 21, 2011)

james4beach said:


> I gave you enough info. I'm not going to spend my night googling for info... if you care about how solvent or reliable the banks are, you should do the work yourself.


You made unsupported claims about things that didn't happen.
You tried to suggest central bank liquidity is "a bailout" to prove your case.

You claim to be a technical guy, but your "logic" doesn't add up.


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## MrBlackhill (Jun 10, 2020)

agent99 said:


> It might be interesting to compare Total Returns with and without dividends re-invested . I have done that for some of the other blue chip stocks I own and IIRC, the banks outperformed them.
> 
> Quick look shows that some of those stocks did outperform the banks over most time frames (although NA was still up there) But they didn't all have the steady cash flow that us retirees like!


True, the only big dividend payers in my list are FTS and EMA, but they are underperforming the banks.

AQN has been a good one for the past 10 years, but I don't know its history with regards to 2008.


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## Jimmy (May 19, 2017)

Banks have been on a tear since they discovered the vaccine, even before. Some US banks are up over 200% over 1 yr. Regret not buying a little Schwab earlier but got in on some insurance and mortgage companies that are also doing well.


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## james4beach (Nov 15, 2012)

MrMatt said:


> You made unsupported claims about things that didn't happen.
> You tried to suggest central bank liquidity is "a bailout" to prove your case.


Liquidity and loans to other businesses *are* considered bailouts, from what I've seen in the media. I'm saying liquidity and emergency loans to banks were bailouts as well.

Either both cases are bailouts, or they are not. Which is it? Make up your mind so I can be clear on your position for liquidity offered to Air Canada.


----------



## MrMatt (Dec 21, 2011)

james4beach said:


> Liquidity and loans to other businesses *are* considered bailouts, from what I've seen in the media. I'm saying liquidity and emergency loans to banks were bailouts as well.
> 
> Either both cases are bailouts, or they are not. Which is it? Make up your mind so I can be clear on your position for liquidity offered to Air Canada.


I've made my position clear.
Liquidity is not a bailout.
Non market rate loans are a bailout.

Neither should be offered to any company by government.

If a particular function is deemed in the national interest, government support of that critical function could be rescued by the government, at taxpayer expense, at the cost of the transfer of that asset (in whole or in part) to the government.

In short, I don't support bailing out Air Canada. However if you feel that a comprehensive national airline service is in the best interests of the country, I would support government support of a post-bankruptcy Air Canada.
But I don't want the shareholders and bondholders, overpriced contracts and other corporate sycophants to benefit from the bailout.


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## james4beach (Nov 15, 2012)

MrMatt said:


> I've made my position clear.
> Liquidity is not a bailout.
> *Non market rate loans are a bailout.*


What a weasel definition that is. The banks did NOT receive market rate loans. They received artificial rates set by the Bank of Canada and Federal Reserve.

By your own definition, the big Canadian banks received a bailout. They received non market rate loans using loans not in the open market, but with a completely fake, non-market rate.

Thanks for confirming that the Canadian banks were bailed out.


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## Eder (Feb 16, 2011)

Its strange over the years that you are the only poster that thinks this way....but of course you are entitled to your opinion as are others right?


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## MrMatt (Dec 21, 2011)

james4beach said:


> What a weasel definition that is. The banks did NOT receive market rate loans. They received artificial rates set by the Bank of Canada and Federal Reserve.
> 
> By your own definition, the big Canadian banks received a bailout. They received non market rate loans using loans not in the open market, but with a completely fake, non-market rate.
> 
> Thanks for confirming that the Canadian banks were bailed out.


Please support the claim that they got non market rate loans.
For additional clarity I do consider the Bank of Canada policy rate a "market rate".

Yes, if the banks were getting reduced rate loans from the government they should have to pay back the differential.

Again, I'm against bailouts, even for the banks.


----------



## birdman (Feb 12, 2013)

james4beach said:


> What a weasel definition that is. The banks did NOT receive market rate loans. They received artificial rates set by the Bank of Canada and Federal Reserve.
> 
> By your own definition, the big Canadian banks received a bailout. They received non market rate loans using loans not in the open market, but with a completely fake, non-market rate.
> 
> Thanks for confirming that the Canadian banks were bailed out.


I was reluctant to wade into this thread but presumably you are aware of the role of the Bank of Canada in regards to the financial system. One of their roles is to provide liquidity. See attached:








Financial System


Canada's financial system consists of financial institutions, such as banks and credit unions; the financial markets; and payments systems.




www.bankofcanada.ca




"If" the Bank of Canada provided liquidity I do not see it as a bailout but simply performing their mandated function. 
Its an interesting subject and from a legal point of view it is theoretically easy for an F/I to obtain liquidity through the money market, the setting of interest rates, borrowing, selling mortgages, issuing commercial paper, etc and I guess as a last resort requesting payment of "Demand" loans. Mind you, depositors can also "Demand" payment from their savings and chequing accounts and then you have a run on the banks. Thus the role of the Bank of Canada. Early in my career I recall the Banks saying there was "tight money" and were restricting commercial lending and even though a business was doing well they was no guarantee their credit line would be renewed at the same level during the annual review. Clearly, the latter is a route that the Banks would not wish to go and presumably thats why the Bank of Canada is around. I might add that is fairly easy for an F/I to obtain liquidity as all they have to do is increase their deposit rates and watch the $$$ flow in. Similarly, they can increase their loan and mortgage rates to temper loan growth. While I am uncertain as to the subject of the reported "secret bailouts" my guess is that if it did happen the borrowing were simply a less expensive way of obtaining liquidity. As I have stated in previous posts I have full confidence in the Canadian Banking system.


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## MrMatt (Dec 21, 2011)

james4beach said:


> Either both cases are bailouts, or they are not. Which is it? Make up your mind so I can be clear on your position for liquidity offered to Air Canada.


What is your position? Should we bail out companies?
Give them handouts for bad management decision?
Give them cash to make the rich richer?


----------



## Eclectic12 (Oct 20, 2010)

james4beach said:


> Details of the full TAF & related program borrowings were not known until much later than 2008 ...


Maybe some details ... but the Fed announced Dec 14th, 2007 that the first auction was for $20 billion of 28 day term loans with a minimum bid rate of 4.17 percent with a $10 million minimum bid, bid increments of $100K and a max bid of $2 billion per institution, according Reuters.

The Dec 17th Fed announcement spells out that auctions results were 4.65% where the $20 billion went to ninety three FIs.

Plus keep in mind the program announced in Dec 2007 ran until March 2010.


For an alleged secret program, there seem to be many press releases detailing a lot of info I'd have thought they'd want to keep secret. 
There seems to be lots to study _as it happened_.




james4beach said:


> Many of these banks (including Canadian ones) required huge amounts of assistance through 2008 ...


A 28 day or 35 day loan that has be be repaid is anything more than temporary?

As I said earlier, the bids had to be through the local reserve bank so at most, it would be the American subsidiary bank. A Canadian bank would be using the BoC program mentioned in the Fed's release and the other country banks would use whatever program their central bank setup with whatever wrinkles in that program.




james4beach said:


> ... Without it, I'm not sure they would have survived.


Clearly the Fed thought it was critical ... but they made $700 million off it so if there were lots of failures, the required collateral seems to have helped.


*Edit:*


james4beach said:


> .... will you agree it's fair for the airlines and aerospace companies to also get equivalent amounts of liquidity and free loans from the govt?


What free loan did TAF provide?

I'm not familiar with US rates so it wouldn't surprise me if it was a discounted rate but with a floor rate published and the after auction rate being higher, I'm not following how it was "free".


Cheers


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## Eclectic12 (Oct 20, 2010)

frase said:


> ... While I am uncertain as to the subject of the reported "secret bailouts" my guess is that if it did happen the borrowing were simply a less expensive way of obtaining liquidity.


For the Federal Reserve TAF that is supposed to be secret, a floor was set based on some rate I've never heard of (but I'm not a US banking expert) where the after auction press release said a higher rate was achieved. 

I'm pretty sure it was less that the usual borrowing methods but when one figures the whole system is in a crunch and a run on the banks is possible/probable, usual borrowing would be restricted/reduced.


Cheers


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## james4beach (Nov 15, 2012)

MrMatt said:


> Please support the claim that they got non market rate loans.
> For additional clarity I do consider the Bank of Canada policy rate a "market rate".


The Bank of Canada rate is not a market rate. They have been given special power to manipulate the price of money, by manipulating the money markets.

But that's going to be a matter of opinion. I'm much more concerned about how you guys are defining bailouts.



frase said:


> "If" the Bank of Canada provided liquidity I do not see it as a bailout but simply performing their mandated function.


So let me see if I understood this correctly.

Large amounts of liquidity for Canadian banks is *not* a bail out. Other companies however (including credit unions), cannot access central bank liquidity lines.

Do I have this right?

Based on the way you've defined this, the only entities that can get public assistance at depressed (artificial) borrowing rates, without the stigma of a "bail out" are large banks. Do you see any possible problem with that?


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## Retiredguy (Jul 24, 2013)

frase said:


> I was reluctant to wade into this thread but presumably you are aware of the role of the Bank of Canada in regards to the financial system. One of their roles is to provide liquidity. See attached:
> 
> 
> 
> ...


My friend and and his two partners were running a very successful business circa 1984 and had a bank LOC all being properly handled. They got called to a meeting and the bank wanted them to sign their homes over as additional collateral. They refused and the bank pulled the loc and killed the business.


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## Numbersman61 (Jan 26, 2015)

Retiredguy said:


> My friend and and his two partners were running a very successful business circa 1984 and had a bank LOC all being properly handled. They got called to a meeting and the bank wanted them to sign their homes over as additional collateral. They refused and the bank pulled the loc and killed the business.
> [/QUOTE


One must always remember that when you borrow money from the bank, at some point it must be repaid. In my professional career which spanned decades, I knew a number of situations where the banker abruptly changed the rules (often with little justification) and the borrower had to scramble to find alternative financing. When times are good and the sun is shining, you can expect the banker to be your friend and offer you tons of cash. As soon as times get tough and it starts raining and you need an umbrella, they no longer are your friend. Many business failures are due to being over-leveraged.


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## birdman (Feb 12, 2013)

james4beach said:


> The Bank of Canada rate is not a market rate. They have been given special power to manipulate the price of money, by manipulating the money markets.
> 
> But that's going to be a matter of opinion. I'm much more concerned about how you guys are defining bailouts.
> 
> ...


I am not saying or providing an opinion on whether or not the proving of liquidity is "a bailout" or not. I am just saying and attached a link that states the one of the roles of the Bank of Canada is to provide liquidity to banks "and Credit Unions". To me this is a "function" or "role" as opposed to a bailout but call it what you wish. You will note that mandate includes "credit unions" but have no idea of the details. I also note that one of the roles of the Central Credit Union is to provide liquidity which would occur before the Bank of Canada got involved. My experience in the F/I business is probably somewhat dated as I have been retired for 18 yrs; however, as I suggested in my previous post liquidity (deposits) were relatively easy to get by simply slightly adjusting rates.


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## kcowan (Jul 1, 2010)

A small business owner had his LOC with TD for 25 years to finance inventory. Then they gave him 30 days to repay, saying the appliance repair business was no longer strategic.

He managed to survive with higher rates but never forgave the bank and the financing was non-bank after that. He adjusted his business to accommodate their higher costs.

So banks are cautious about protecting themselves. Bailouts are fundamental to,how our society works.

To conclude that banks are not safe is to question the underpinning of our capitalist system. Maybe such people should stick with government bonds and GICs.


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## MrMatt (Dec 21, 2011)

james4beach said:


> The Bank of Canada rate is not a market rate. They have been given special power to manipulate the price of money, by manipulating the money markets.
> 
> But that's going to be a matter of opinion. I'm much more concerned about how you guys are defining bailouts.


I disagree, the Bank or Canada policy rate is a rate prescribed by the Bank of Canada to manipulate the money supply in Canada.
It is intended, and used, to give control to the Bank of Canada.

Also it's important to note that the policy rate is the rate banks lend each other money, it is a prescribed market rate.



> So let me see if I understood this correctly.
> 
> Large amounts of liquidity for Canadian banks is *not* a bail out.


Correct



> Other companies however (including credit unions), cannot access central bank liquidity lines.
> Do I have this right?


I don't know.



> Based on the way you've defined this, the only entities that can get public assistance at depressed (artificial) borrowing rates, without the stigma of a "bail out" are large banks. Do you see any possible problem with that?


I see a lot of problems with government manipulation of the money supply.
I don't think they should do it.

However, just because the Bank of Canada is directed by the government to manipulate the money supply doesn't mean those manipulations are bailouts.
When they set a policy rate higher or lower, those changes aren't IMO bailouts.


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## Eder (Feb 16, 2011)

Numbersman61 said:


> When times are good and the sun is shining, you can expect the banker to be your friend and offer you tons of cash. As soon as times get tough and it starts raining and you need an umbrella, they no longer are your friend.


This is what makes them a good investment. You can always use your Royal Bank shares to secure a loan.


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## Mechanic (Oct 29, 2013)

When I started my business the banks helped me. But I had to sign everything to them as collateral, including my home. I diligently worked at paying off everything I owed them till I was free and clear. I later had to use my collateral to secure financed inventories at various stages and it's always a concern. Business owners always have to take some risk to be invested in their company, just like investing in other companies.


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## Numbersman61 (Jan 26, 2015)

Some 40 years ago, a bank called The Northland Bank, headquartered in Calgary, encountered financial difficulty; the senior management was hiding bad loans by some creative accounting tricks. My understanding is that Governor of The Bank of Canada requested one of major banks (which shall remained unnamed) to conduct a special investigation to determine if a takeover was feasible. When the President of the potential acquirer received details of the sad state of affairs, he issued a directive that all bank loans with Northland Bank stock as collateral were to be immediately called and the Northland bank stock sold.


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## Eclectic12 (Oct 20, 2010)

MrMatt said:


> james4beach said:
> 
> 
> > ... Large amounts of liquidity for Canadian banks is *not* a bail out. Other companies however (including credit unions), cannot access central bank liquidity lines ...
> ...


Are there references to CUs and other companies being barred from access?

For another BoC liquidity program, provincially regulated companies including CUs and trust companies are part of the eligible group.

I'm not sure what would be special about the 2007/2008 issues to bar companies that are eligible for other liquuidity programs.


Cheers


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## MrMatt (Dec 21, 2011)

MrMatt said:


> When they set a policy rate higher or lower, those changes aren't IMO bailouts.


So James
If setting the policy rate lower is a bailout, what is setting the policy rate higher?

If setting policy is a bailout, and you're opposed to bailouts, it follows you're opposed to Government bailouts/ policy interventions.

I'd be good with dramatically reducing bailouts and government policy interventions.
We should immediately call for the government to dramatically reduce policy interventions.


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## james4beach (Nov 15, 2012)

Mechanic said:


> Business owners always have to take some risk to be invested in their company, just like investing in other companies.


As a hard working business owner, surely you expect other businesses in Canada to also take risk the same way you were forced to.

But Canadian banks don't take much risk, because when they mismanage their businesses or take massively aggressive, leveraged gambles (as they did in the lead-up to 2008) they are provided endless liquidity support from the central banks.

YOU, as a non-bank business owner, are not given endless liquidity support. Air Canada isn't either. This creates a two tier system where business owners like YOU are forced to take risk, and might fail. Large banks on the other hand, don't really take any risk -- ever. It's a corruption of capitalism.

The easy solution to this is to bust up all the large banks, and separate out their high risk division (capital markets) from depository banking (traditional bank). This is how the system used to be before the 1990s. Then, we can give endless support and liquidity to the traditional banks, and you let the capital markets / hedge funds division gamble all they want, and let them *fail* when they screw up. That's how banking used to be in the past.


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## cainvest (May 1, 2013)

james4beach said:


> YOU, as a non-bank business owner, are not given endless liquidity support. Air Canada isn't either.


Wasn't Air Canada bailed out in early 2000's ?


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## Eder (Feb 16, 2011)

Sunwing just recently....free money...its the future... (till Ontario quits electing Sockboy )


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## james4beach (Nov 15, 2012)

Eder said:


> Sunwing just recently....free money...its the future... (till Ontario quits electing Sockboy )


You're being hypocritical. You supported the banks getting loans (liquidity) and as I recall, you did not consider that a bail out. You sounded very much in favour of the banks getting free money.

Sunwing is also getting loans (liquidity). It's credit, and must be repaid. They did not get a bailout.


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## MrMatt (Dec 21, 2011)

james4beach said:


> As a hard working business owner, surely you expect other businesses in Canada to also take risk the same way you were forced to.
> 
> But Canadian banks don't take much risk, because when they mismanage their businesses or take massively aggressive, leveraged gambles (as they did in the lead-up to 2008) they are provided endless liquidity support from the central banks.
> 
> ...


Great idea, I even support that.

Now back to the question of bailouts, since it's wrong to bail out the banks, it should also be wrong to bail out other companies.

I do believe support of strategically important industries can be done, however it should come with an appropriate compensation to the people of Canada.
That being said, I am strongly against the nationalization of private businesses.


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## Tostig (Nov 18, 2020)

CIBC finally breaks past its pre-covid crash high of $25.21. Will it stay up like the other banks or pull back a bit before breaking through again like Royal Bank?

Bank of Nova Scotia is the remaining laggard.


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## agent99 (Sep 11, 2013)

Tostig said:


> Bank of Nova Scotia is the remaining laggard.


It's above it's pre-covid Jan 2020 price, but below it's 2017 high. Doing much better lately.


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## Tostig (Nov 18, 2020)

agent99 said:


> It's above it's pre-covid Jan 2020 price, but below it's 2017 high. Doing much better lately.


I'm waiting for BNS to cross $82 which is my break even point of my highest price purchase of this stock.


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## Eder (Feb 16, 2011)

I think anticipation of upcoming juicy dividend increases are behind the price rally. Unfortunately prices are too high for me now ... I enjoyed buying them much better last year while the world was still ending.


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## robfordlives (Sep 18, 2014)

When will regulators let the banks raise dividends once again? COVID is over despite the doomers out there insisting we will never return to normal. Surely they are applying pressure behind the scenes. Enough is enough!!


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## Money172375 (Jun 29, 2018)

robfordlives said:


> When will regulators let the banks raise dividends once again? COVID is over despite the doomers out there insisting we will never return to normal. Surely they are applying pressure behind the scenes. Enough is enough!!


I suspect dividend increases and share increases are partially baked in already. You’ll likely a little short term pop once they announce.


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## Tostig (Nov 18, 2020)

robfordlives said:


> ...COVID is over despite the doomers out there insisting we will never return to normal. ...


Tell your brother, Doug, that.


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## milhouse (Nov 16, 2016)

robfordlives said:


> When will regulators let the banks raise dividends once again? COVID is over despite the doomers out there insisting we will never return to normal.


Saw Mark of MyOwnAdvisor tweet out about OSFI unwinding their covid regulatory requirements for the banks effective May 1. The next time the banks release quarterly earnings is the end of May. So earliest divvy increase for the banks happening May for the July payments. I was expecting end of year but this a bonus if they increase in May.


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## Retiredguy (Jul 24, 2013)

milhouse said:


> Saw Mark of MyOwnAdvisor tweet out about OSFI unwinding their covid regulatory requirements for the banks effective May 1. The next time the banks release quarterly earnings is the end of May. So earliest divvy increase for the banks happening May for the July payments. I was expecting end of year but this a bonus if they increase in May.







__





OSFI unwinds regulatory adjustments for banks subject to market risk capital adequacy rules







www.osfi-bsif.gc.ca


----------



## zinfit (Mar 21, 2021)

I own a little bit of CM and RY in my TFSA otherwise I avoid holding the banks.. Over the past 10 years I had a fairly sizeable position in the USA tech sector . This has been very, very profitable and has allowed me to average 21% per annum including my fixed income investments. In reviewing the performance of the 5 Canadian banks over that period it is a bit of a head scratcher why so many Canadians pile so much into his sector. I guess their key metric is dividends.Perhaps the holders of taxable accounts like the tax treatment of the dividends. Even including dividends the overall return can be described as modest at best .


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## Covariance (Oct 20, 2020)

zinfit said:


> I own a little bit of CM and RY in my TFSA otherwise I avoid holding the banks.. Over the past 10 years I had a fairly sizeable position in the USA tech sector . This has been very, very profitable and has allowed me to average 21% per annum including my fixed income investments. In reviewing the performance of the 5 Canadian banks over that period it is a bit of a head scratcher why so many Canadians pile so much into his sector. I guess their key metric is dividends.Perhaps the holders of taxable accounts like the tax treatment of the dividends. Even including dividends the overall return can be described as modest at best .


One reason is because it's relative. Your assessment of the Banks is relative to tech. Others assessment is relative to lower returning sectors/asset classes. 

Another factor is disproportionate weighting of income (dividends) as you mention. It's a known phenomenon. Another known phenomenon is "home bias".


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## zinfit (Mar 21, 2021)

Covariance said:


> One reason is because it's relative. Your assessment of the Banks is relative to tech. Others assessment is relative to lower returning sectors/asset classes.
> 
> Another factor is disproportionate weighting of income (dividends) as you mention. It's a known phenomenon. Another known phenomenon is "home bias".


I have never understood home bias and putting all or most of your eggs in one basic. I understand that with the resources base and other sectors Banks probably compares well. Don't get new wrong I also had a solid position in other USA stocks. Costco, Home Depot , Lowe's, Stryker, JNJ , Papa Johns, and General Dollar are some of the non tech stocks that I have held over the past 10 years.. They have given me superior returns. I am anything but nationalistic when it comes to investing. IMO home bias is a weakness not a strength.


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## doctrine (Sep 30, 2011)

OSFI may not be so quick to allow the banks to increase dividends or buybacks, or so it was suggested today by OSFI. Probably have to wait another quarter. Meanwhile, the billions of cash accumulate. There is a good argument for special dividends here, or large buybacks, to get that money out of their hands. Many Canadian banks have a history of acquisitions that don't work out; I'm sure at least one of them is going to get spendy.


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## Covariance (Oct 20, 2020)

doctrine said:


> OSFI may not be so quick to allow the banks to increase dividends or buybacks, or so it was suggested today by OSFI. Probably have to wait another quarter. Meanwhile, the billions of cash accumulate. There is a good argument for special dividends here, or large buybacks, to get that money out of their hands. Many Canadian banks have a history of acquisitions that don't work out; I'm sure at least one of them is going to get spendy.


Probably worth pricing in the risk that Ottawa has other plans for that cash.


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## zinfit (Mar 21, 2021)

Covariance said:


> Probably worth pricing in the risk that Ottawa has other plans for that cash.


Makes sense to be prudent. The current covid wave is the most serious one and there is no reason to believe its business as usual


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## hboy54 (Sep 16, 2016)

It is interesting how often one can get a 60 or 80% return in a year on Canadian Banks. Like buying about a year ago, early 2016, and of course 2009.


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## zinfit (Mar 21, 2021)

hboy54 said:


> It is interesting how often one can get a 60 or 80% return in a year on Canadian Banks. Like buying about a year ago, early 2016, and of course 2009.


The stock price today for most of 5 big banks is only slightly better than what is was in 2011. It sounds like you are talking about trading the stock rather than buy and hold. I have never enjoyed consistent success trading bank stocks or any other stock.


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## Eder (Feb 16, 2011)

Well it really pays to buy the banks when they're under pressure since they are very reliable blue chip companies...I won't post my returns but I did buy at opportune times like most try to do.


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## Retiredguy (Jul 24, 2013)

$1000 of TD common on April 28, 2011 with divs reinvested is worth $2960 today.
Without divs $2073.


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## like_to_retire (Oct 9, 2016)

zinfit said:


> The stock price today for most of 5 big banks is only slightly better than what is was in 2011. It sounds like you are talking about trading the stock rather than buy and hold. I have never enjoyed consistent success trading bank stocks or any other stock.


I don't know, but if I chart Total Return of the two biggest banks in TD and RY since Jan 2011 versus the XIC Index I get this?












ltr


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## zinfit (Mar 21, 2021)

Yes TD has done reasonable well and RY not bad. The other three have stumbled along with a stock price increase between 1,8 %- to 5% on an annual average. I understand that the dividends aren't included. I recall doing the 10 average back in the fall and the returns were somewhat lower. I held a lot the large techie through this decade. Microsoft, Apple Google , Amazon, FB and others through that decade I can't place a total return but I am quite confident that would be higher the QQQ which gave a 490% return over that period. When I examine the balance sheets for these techies they have virtually no debt, profit margins between 25 and 40% , they have extraordinary levels of cash and cash equivalents. Apple and Microsoft had something like 150 billion each , Google a 100 billion and the other two in the range of 60 billion. All have had growth rates above 20% . Most have a a ROC about 20 and most have an ROE above 30% . By those metrics the banks don't score. The other thing to consider these big tech companies are an integral part of the life of most people and businesses . Does Canadian Money use the cloud services? People on this site are using their products or services on a daily basis. There are very few corporations that don't use their cloud services.They are also major disrupters that can strike fear in the heart of any traditional business. That is my experience and point of view. Don't be offended each to his own. I think we are better served when we share our thoughts and experience.


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## Covariance (Oct 20, 2020)

zinfit said:


> Yes TD has done reasonable well and RY not bad. The other three have stumbled along with a stock price increase between 1,8 %- to 5% on an annual average. I understand that the dividends aren't included. I recall doing the 10 average back in the fall and the returns were somewhat lower. I held a lot the large techie through this decade. Microsoft, Apple Google , Amazon, FB and others through that decade I can't place a total return but I am quite confident that would be higher the QQQ which gave a 490% return over that period. When I examine the balance sheets for these techies they have virtually no debt, profit margins between 25 and 40% , they have extraordinary levels of cash and cash equivalents. Apple and Microsoft had something like 150 billion each , Google a 100 billion and the other two in the range of 60 billion. All have had growth rates above 20% . Most have a a ROC about 20 and most have an ROE above 30% . By those metrics the banks don't score. The other thing to consider these big tech companies are an integral part of the life of most people and businesses . Does Canadian Money use the cloud services? People on this site are using their products or services on a daily basis. There are very few corporations that don't use their cloud services.They are also major disrupters that can strike fear in the heart of any traditional business. That is my experience and point of view. Don't be offended each to his own. I think we are better served when we share our thoughts and experience.


What non-tech investors don't understand is the power of ROIC, cashflow. There are a small number of people who even understand what it means to have negative working capital. On the other hand, to be fair, if we look at the S curve - the lifetime of a tech company is shorter (than a bank).


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## zinfit (Mar 21, 2021)

Covariance said:


> What non-tech investors don't understand is the power of ROIC, cashflow. There are a small number of people who even understand what it means to have negative working capital. On the other hand, to be fair, if we look at the S curve - the lifetime of a tech company is shorter (than a bank).


Good point. In terms of the big techs they have been around for quite awhile and I don't see them going away. Apple ,Google and Microsoft have been around for decades and keep growing and increasing earnings and revenue at very high levels. In the age of technology and disruption I wonder how the longterm security of the bank moat will be. Will Amazon get into banking? If they what impact would that have? Then we see the evolution of crypto currency and the possibility of radically changing how we view currency and finance. I note that a growing business in the US is on-line mortgage lenders and it could be a new entry into Canada. There are a lot of things in flux and for banks I might use the famous quote " past performance might not be indicative of future performance".


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## Covariance (Oct 20, 2020)

zinfit said:


> Good point. In terms of the big techs they have been around for quite awhile and I don't see them going away. Apple ,Google and Microsoft have been around for decades and keep growing and increasing earnings and revenue at very high levels. In the age of technology and disruption I wonder how the longterm security of the bank moat will be. Will Amazon get into banking? If they what impact would that have? Then we see the evolution of crypto currency and the possibility of radically changing how we view currency and finance. I note that a growing business in the US is on-line mortgage lenders and it could be a new entry into Canada. There are a lot of things in flux and for banks I might use the famous quote " past performance might not be indicative of future performance".


There are risks but the regulatory moat is strong for FIs. Compliance, regulated capital levels etc are non-trivial.


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## zinfit (Mar 21, 2021)

Covariance said:


> There are risks but the regulatory moat is strong for FIs. Compliance, regulated capital levels etc are non-trivial.


Yes you make a point.Regulations don't have the control they used to have..I am using my T-mobile unrestricted in Canada. CRTC.has little control over Netflix and other streaming services. Regulations to ban or eliminate Uber haven't be very effective.


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## Eder (Feb 16, 2011)

T-Mobile may start complaining after 5 gigs of data use /month in Canada. Have you exceeded this amount of 5g?


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## zinfit (Mar 21, 2021)

Eder said:


> T-Mobile may start complaining after 5 gigs of data use /month in Canada. Have you exceeded this amount of 5g?


not yet . Did they complain to you?


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## Eder (Feb 16, 2011)

They did the month before I returned to Hawaii...that was after 5 months in Canada and exceeding the 5 gigs of high speed data the last month.

At any rate regarding this discussion...I believe that tech stocks in general pose a much greater risk to capital than do Canadian banks...the returns should be higher as reward for assuming that risk.


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## Retiredguy (Jul 24, 2013)

With Banks set to release q2 earnings this week can anyone confirm whether or not they are allowed to raise divs? There seems to be conflicting info on this.


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## doctrine (Sep 30, 2011)

They are not currently allowed to raise dividends or start buybacks. So it will be either Q3 or Q4. But they can start releasing the extraordinary loan losses which will show up as profit and additional excess capital.


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## newfoundlander61 (Feb 6, 2011)

Here is when each bank is scheduled to report its fiscal second-quarter earnings: 

Bank of Montreal – May 26
Canadian Imperial Bank of Commerce – May 27 
Royal Bank of Canada – May 27
Toronto-Dominion Bank – May 27
National Bank of Canada – May 28 
Bank of Nova Scotia – June 1


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## zinfit (Mar 21, 2021)

newfoundlander61 said:


> Here is when each bank is scheduled to report its fiscal second-quarter earnings:
> 
> Bank of Montreal – May 26
> Canadian Imperial Bank of Commerce – May 27
> ...


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## james4beach (Nov 15, 2012)

doctrine said:


> They are not currently allowed to raise dividends or start buybacks. So it will be either Q3 or Q4. But they can start releasing the extraordinary loan losses which will show up as profit and additional excess capital.


Are the Canadian banks still prohibited from raising dividends? The OSFI had put in this requirement but I wasn't clear on how far that extended.


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## james4beach (Nov 15, 2012)

zinfit said:


> not yet . Did they complain to you?


I'm on T-Mobile as well. Just FYI, their offer for free data (larger cap) is domestically in the US, but when using data in Canada, you're still limited to the original GB of your plan. After that point it's still free data, but drops in speed dramatically.

I've been using T-Mobile in Canada continuously and have never gotten any complaints from them about my data usage, but I also did not exceed my 2 GB cap.


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## doctrine (Sep 30, 2011)

james4beach said:


> Are the Canadian banks still prohibited from raising dividends? The OSFI had put in this requirement but I wasn't clear on how far that extended.







__





COVID-19 Measures – FAQs for Federally Regulated Deposit-Taking Institutions







www.osfi-bsif.gc.ca













OSFI signals no plans to loosen bank buyback, dividend restrictions in near term - BNN Bloomberg


In a speech Tuesday, Office of the Superintendent of Financial Institutions (OSFI) Assistant Superintendent Ben Gully said the banking regulator was still monitoring the impact of the third wave of the pandemic and plans to leave the measures in place until the concerns subside.




www.bnnbloomberg.ca


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## MrMatt (Dec 21, 2011)

I think they'll keep on it until things aren't too crazy. Also it's politically difficult to let banks hike dividends or do buybacks right now.

The hiking of fees really pissed off a lot of people, but I think that was expected when the government forced low fee accounts.


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## Retiredguy (Jul 24, 2013)

MrMatt said:


> I think they'll keep on it until things aren't too crazy. Also it's politically difficult to let banks hike dividends or do buybacks right now.
> 
> The hiking of fees really pissed off a lot of people, but I think that was expected when the government forced low fee accounts.


Politically difficult .....yah all the seniors(voters) might whine, oblivious to the fact that those divs and buybacks directly effect the viability and funding of their pensions, including the CPP, and likely also somewhere in their RRSP/RRIF's


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## zinfit (Mar 21, 2021)

J


Retiredguy said:


> Politically difficult .....yah all the seniors(voters) might whine, oblivious to the fact that those divs and buybacks directly effect the viability and funding of their pensions, including the CPP, and likely also somewhere in their RRSP/RRIF's


If you don't like the fees move your account. There are other options .


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## Retiredguy (Jul 24, 2013)

zinfit said:


> J
> 
> If you don't like the fees move your account. There are other options .


If this was directed to me you misunderstood my post.


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## zinfit (Mar 21, 2021)

Retiredguy said:


> If this was directed to me you misunderstood my post.


sorry . I misunderstood your intent.


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## MrMatt (Dec 21, 2011)

Retiredguy said:


> Politically difficult .....yah all the seniors(voters) might whine, oblivious to the fact that those divs and buybacks directly effect the viability and funding of their pensions, including the CPP, and likely also somewhere in their RRSP/RRIF's


I was thinking about all the yungins with their iPhones and insane data plans complaining about a $5/month fee, because they're too lazy to change their account type


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## Kilbarry20 (Aug 19, 2020)

My story. Aside from 2 car loans completed in 2022, I have no liabilities, other than the usual bills, plus a significant mortgage & LOC free home. I have different pools of investment ca$h, mostly under different banks purview. I have left myself 3/7 of the investment capital in 2 TFSAs and a larger account to deal with. The only goal is to not lose it! I don’t need the cash really and am doing this for my grandchildren. (I already purchase RESPs yearly and direct those through my daughter’s account)

So, since the beginning of the year, I have developed a relentless, day trading, ‘buy on dips’ strategy. I get out as I see fit, happy to lock in hundreds of dollars of profit in 5 minutes, 5 hours or 5 days. If it takes 5 weeks... so be it, but that is rare. My rotation is a very small, conservative, Canadian equity, dividend producing one- the Top 3 Banks + BCE. My strategy is centered around Dividend dates & Quarterly Earnings dates. So, 8 x per year. Sometimes, I go through the Record date to get the Div... and wait for the next price rise, others I sell the day before. The other critical factor is daily ‘volatility play’- meaning CM, BMO & RY. You must have that. If the stock rarely moves, there is no use for me. I also limit my Buys to the top priced equity, which would be CM today. That is, not interested in paying $100s per share, nor am I going to ever be getting into margins, etc. This is very conservative stuff, I do.

Since New Year’s Day, I have a record of about 30-1.
Interested in whether I am missing out on other comparable targets.


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## jargey3000 (Jan 25, 2011)

Kilbarry20 said:


> My story. Aside from 2 car loans completed in 2022, I have no liabilities, other than the usual bills, plus a significant mortgage & LOC free home. I have different pools of investment ca$h, mostly under different banks purview. I have left myself 3/7 of the investment capital in 2 TFSAs and a larger account to deal with. The only goal is to not lose it! I don’t need the cash really and am doing this for my grandchildren. (I already purchase RESPs yearly and direct those through my daughter’s account)
> 
> So, since the beginning of the year, I have developed a relentless, day trading, ‘buy on dips’ strategy. I get out as I see fit, happy to lock in hundreds of dollars of profit in 5 minutes, 5 hours or 5 days. If it takes 5 weeks... so be it, but that is rare. My rotation is a very small, conservative, Canadian equity, dividend producing one- the Top 3 Banks + BCE. My strategy is centered around Dividend dates & Quarterly Earnings dates. So, 8 x per year. Sometimes, I go through the Record date to get the Div... and wait for the next price rise, others I sell the day before. The other critical factor is daily ‘volatility play’- meaning CM, BMO & RY. You must have that. If the stock rarely moves, there is no use for me. I also limit my Buys to the top priced equity, which would be CM today. That is, not interested in paying $100s per share, nor am I going to ever be getting into margins, etc. This is very conservative stuff, I do.
> 
> ...


very interested in this^^^
Can you give me an idea of how much $$$ you have tied up in this?
And an idea of how much you are making. or have made, since starting?


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## dubmac (Jan 9, 2011)

I think credit unions have low monthly fees - which may be a good choice for those looking for lower expenses.

I've been watching the banks as their quarterly results roll in. 
Gotta love d'em banks. nice to see a little upside for anyone who held their nose and bought last March and April.


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## Kilbarry20 (Aug 19, 2020)

Ok, so I don’t really want to itemize the exact number of shares per trade, but every Buy is > $50k. I am hesitant to be “greedy”, although it seems fairly fool proof and really, if the price warrants, taking 3 different shots at the same time. I am up to 2 normally. I have NO sophisticated digital program to track- prolly should if I got really serious. Rather, only my eyes watching action jumps from today or prior days. Covid has, of course, allowed me the time and opportunity to do this. From mid Feb through today, I am up about $11k. I’m not making a salary from this, just enough for a few good trips (when we can again) or gifts.

If there is a Covid type crash ala last March and I got caught in the switches, I will just ride it out. If ANY of those Banks go to zero, you know Armageddon has occurred and nobody is left alive, so nothing will matter anyway.


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## jargey3000 (Jan 25, 2011)

^^^thanks^^^
so.....if I give you $50k today, to play for me.....will you give me back $60k by say, Aug. 31?😈


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## Kilbarry20 (Aug 19, 2020)

jargey3000 said:


> ^^^thanks^^^
> so.....if I give you $50k today, to play for me.....will you give me back $60k by say, Aug. 31?😈


Well, if you gave me 50 today, that’s not quite enough for the contract size I normally buy. The price of Poker & the Banks has gone up! 😂 e.g. An early January CM contract I sold for $111, March & April 4 with high point $126. Today, it is + $141, up almost $5!

Buuuuut, I would say, having reviewed the total, that will be my short term goal from now on- $10k in 3 months. I do obviously need, a complete Calendar Quarter round, spanning a Dividend AND Earnings Report.


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## robertsclak (Feb 22, 2021)

jargey3000 said:


> ^^^thanks^^^
> so.....if I give you $50k today, to play for me.....will you give me back $60k by say, Aug. 31?😈


Absolutely, Just send over the 50k and the rest is Guaranteed.


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## Kilbarry20 (Aug 19, 2020)

If there is any interest, I’ll start posting what I’m doing with my little conservative equity Dividend & Earnings strategy over the next calendar quarter. I’ll give some details of purchases and sales and profit (hopefully) made. If there isn’t, I’ll stop.

NOTE: I am only a moderately informed, amateur, Investor, NOT A PROFESSIONAL FINANCE ADVISOR! Be guided accordingly, with what you do yourself!

Reminder- my strategy involves buying a few conservative Canadian equities with Dividends- largely banks. AND, they must have close to a minimum dollar, daily play- up or down. Static is a no go for me.

Anyway, yesterday was a Bank equity soaring day. So, no Buy for me. I did obtain BCE. And, another I pulled from my arse, one I’d seen reviews of on BNN previously & kinda jumping the shark a bit- Interfor (IFP). As God is my witness, I had no clue about this, which I read news about POST purchase!

_BURNABY, British Columbia, May 12, 2021 -- INTERFOR CORPORATION (TSX: IFP) announced today that its Board of Directors has declared a one-time special cash dividend of $2.00 per share, which will be paid on or before June 28, 2021 to shareholders of record on May 28, 2021. _

THAT will be a $1k winner next month!

BOTH are up today at the moment I am posting here.
I am also seeking out RY and missed the significant drop. Trying to obtain if it sinks close to that low by day’s end.

Cheers.


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## agent99 (Sep 11, 2013)

Seems this thread has moved from being about investing in banks and become a gambling discussion.

The banks have been doing well. If an "investor" had put $10k into each of the 6 major banks one month ago, their portfolio would now be up by 6.68% or $4000. Those of us with substantial buy and hold investments in the banks have done a lot better than that!


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## jargey3000 (Jan 25, 2011)

Kilbarry20 said:


> If there is any interest, I’ll start posting what I’m doing with my little conservative equity Dividend & Earnings strategy over the next calendar quarter. I’ll give some details of purchases and sales and profit (hopefully) made. If there isn’t, I’ll stop.
> 
> NOTE: I am only a moderately informed, amateur, Investor, NOT A PROFESSIONAL FINANCE ADVISOR! Be guided accordingly, with what you do yourself!
> 
> ...


Yes, I, for one, would love to see what you're doing kibarry.!
Why don't you start a new thread, with an appropriate title?

Question: do you simply buy & sell the shares outright? no options or whatever? you mentioned "contracts" somewhere up thread...?


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## Kilbarry20 (Aug 19, 2020)

I’m going to hold off, for the moment, but I don’t mind your suggestion. Again, I buy & sell x00 share blocks of a few, conservative, dividend paying, constantly moving, Canadian equities. NO options, NO warrants, etc. and all through a Discount Broker. I may Sell in 5 minutes, 5 hours, 5 days or 5 weeks, depending on the size of the uptick. This is a grind out strategy, where I may make $50 or $500 per, but the vast majority, are in the multi hundred dollar profit range. 

I sometimes run through the Dividend Dates to get it, especially if it’s one of the big 3- CM, BMO or Royal. Then, I wait until the inevitable post Record Day downturn has turned up again, to exceed my Buy number and then Sell. I’m going to test this strategy out, given my previous summary, whether I can make $40k in a calendar year. Think it’s absolutely possible, although I may have to put several balls in the air at once, rather than the prior 1-2. I bought 3 different ones on Friday, so let’s see.

I do have a couple of trading accounts, which I ONLY add to, never trade, for the future benefit of my Grand chiIdren. I also have several other conservative mutual fund/ GIC type accounts- which are a majority of my investment portfolio, in banks, under their control- as agreed to by me.


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## Mechanic (Oct 29, 2013)

I have been doing similar to you Kilbarry20 in my taxable account for some time. It did get hit hard when Covid pandemic hit but has since recovered and grown, except for a few stragglers. I trade in and out of companies I like as well, sometimes catching a nice divvy and then wait for recovery before selling. Times I'm in vary between a few hours and a few months (rare) and I usually look for 5-10% and will buy 200, 500, 1000 depending on share price and sometimes add if I see an opportunity. I could probably do better if I could handle selling losers better but tend to hold on and collect divvys. I also have a portion of it in US funds and occasionally will buy in US, depending on what I have available in the account. Divs from this account generate an average of around 4% but the trades have made around 12% since January. I peruse my watchlist most days and will jump on any occasional spikes or drops if I see a recovery. I have been slowly educating myself on options but am not comfortable with it so just buy and sell the stock at this point.


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## robertsclak (Feb 22, 2021)

Mechanic said:


> I have been doing similar to you Kilbarry20 in my taxable account for some time. It did get hit hard when Covid pandemic hit but has since recovered and grown, except for a few stragglers. I trade in and out of companies I like as well, sometimes catching a nice divvy and then wait for recovery before selling. Times I'm in vary between a few hours and a few months (rare) and I usually look for 5-10% and will buy 200, 500, 1000 depending on share price and sometimes add if I see an opportunity. I could probably do better if I could handle selling losers better but tend to hold on and collect divvys. I also have a portion of it in US funds and occasionally will buy in US, depending on what I have available in the account. Divs from this account generate an average of around 4% but the trades have made around 12% since January. I peruse my watchlist most days and will jump on any occasional spikes or drops if I see a recovery. I have been slowly educating myself on options but am not comfortable with it so just buy and sell the stock at this point.





Mechanic said:


> I have been doing similar to you Kilbarry20 in my taxable account for some time. It did get hit hard when Covid pandemic hit but has since recovered and grown, except for a few stragglers. I trade in and out of companies I like as well, sometimes catching a nice divvy and then wait for recovery before selling. Times I'm in vary between a few hours and a few months (rare) and I usually look for 5-10% and will buy 200, 500, 1000 depending on share price and sometimes add if I see an opportunity. I could probably do better if I could handle selling losers better but tend to hold on and collect divvys. I also have a portion of it in US funds and occasionally will buy in US, depending on what I have available in the account. Divs from this account generate an average of around 4% but the trades have made around 12% since January. I peruse my watchlist most days and will jump on any occasional spikes or drops if I see a recovery. I have been slowly educating myself on options but am not comfortable with it so just buy and sell the stock at this point.


This is a rising market,not many loosing money,but it wont always be this easy.


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## Kilbarry20 (Aug 19, 2020)

robertsclak said:


> This is a rising market,not many loosing money,but it wont always be this easy.


Of course! That’s understandable and when you take the oars out of the water. Of course, if there is a Covid or Depression type situation, you may be caught. And then, you wait for wherever you believe is the bottom, to buy more of the same quality, super stars.

And since I’ve had a disastrous foray decades ago with a supposed star of the day- Nortel, I am VERY cautious with a few choices. Of course, now you can yourself get in and out in a digital instant- not having to use convoluted, wait on line, phone call deals,without watching real time share price.

So? Make hay until you don’t.


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## Mechanic (Oct 29, 2013)

I have changed my strategy somewhat and tend to take smaller wins more frequently.


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## Kilbarry20 (Aug 19, 2020)

Mechanic said:


> I have changed my strategy somewhat and tend to take smaller wins more frequently.


Yep. That’s what I do. It’s not for everybody and is counter to the principle of: “you can almost never catch the bottom of the lows, nor sell at the apex of the highs.”

Agreed. But, I’m not trying to do that. When I sell at a profit and the stock drops, I’m smiling. AND, get ready to Buy again! If it still climbs, I still smile, because I’m out at a profit. I base my profit taking on the following thought. Did I, ever in my work career, make X In a day? If not? SELL!

And this true story, witnessed by me, with a friend during a Vegas trip. He was a yuuuge investor & financial adviser at the time, me- not at all! He had an insider trading tip on a highly speculative gold stock- (the type I avoid here). Which on that one day, while we sat in the Horse Sports Book, went up to $127,000 of value, I tried to persuade him to Sell, with the rationalization that his highest winning net after 3 days in Vegas was 1200x less! He was going to make $100k + that day.

Nope, he said. It’s going to the equivalent of $500k. Simply, could not see the Forest from Mars. You know what happened. Down, down, down to peanuts.

Two days ago, I bought 3 equities for about $108k. Unfortunately, I was a day early for RY, as it crashed yesterday. In total on the 3, down about $1k after 2 days. Buuuut today, rocketing back +$1500 or about $300 of profit. Yes, going back to the above- $300 is fine, but given that I have 3 acquisitions and 1 is Royal- which is apparently about to increase its’ Dividend perhaps $0.20 to $1.28/, I’m holding on for $1k total, minimum.

I’ll re-evaluate tomorrow, unless there is a spike in the next 30 minutes.

COB on JN 4 Sold BCE & RY for a combined + $610. Back in next week.


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