Macklem Says Big 6 Capital Relief Won’t Spur Lending Alone
Updated
Updated · Bloomberg · Jun 23
Macklem Says Big 6 Capital Relief Won’t Spur Lending Alone
1 articles · Updated · Bloomberg · Jun 23
Summary
Tiff Macklem said looser capital rules for Canada’s Big Six banks, by themselves, will not materially lift lending or broader economic activity.
Borrower demand is the missing link: making it easier for banks to extend credit does little if businesses are not seeking loans.
Macklem said the lower capital requirements “won’t hurt,” but argued they cannot fix Canada’s sluggish business investment on their own.
The remarks push back on expectations that the recent regulatory change would quickly translate into stronger credit growth or a near-term economic boost.