Trump’s tariff threats frustrate Canadian banking clients

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The CEO says that his president in the United States has not officially imposed 25 percent of Canadian goods on Canadian goods, but his threats have already created a “little stagnation” among Canadian banking clients who have become more cautious about their next steps.

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The definitions, which were originally imposed on February 4, were delayed a month after Canada's promise to take stricter action against illegal immigration and drug trafficking at the end. As a week has passed, Trump did not show any signs of retreat.

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“People keep their powder and wait for what will happen,” Phil Thomas, the chief risk official at Nova Scotia Bank, said in a call with analysts on Tuesday. “As a result, whether it is on the part of the retail, the side of the company or the commercial side, you see a kind of stagnation at the present time. It causes people to stop temporarily and think about what they will do.”

Daril White, CEO of Bank of Montreal, said that its clients in both the United States and Canada have adopted “a more cautious situation about the deployment of capital.”

Both Nova Scotia and Montreal Bank – whose results were reported on Tuesday – allocated funds to address the potential effects of definitions, but it was not able to define the definitions.

In order to find the exact number, they must work through a number of factors such as the size and duration of the definitions, the degree of revenge against Canada and the amount of government support.

He said: “It is really difficult to give you a group or a result at this stage of time without understanding what these definitions seem to.” “If the definitions come in the Q2, we will construct the right in the Q2. It will be a large construction, but it can be controlled.”

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Thomas said that there is not much that can be done until Trump signs an executive matter on the definitions.

“We are still scorching what is happening,” he said. “It is difficult to work on addresses and tweets.”

Likewise, the chief risk official at BMO PIYOUUUUHEWAL said that the bank felt that it was “wise to consider sensitivities in the environment” as a result of the threats of customs tariffs.

“If the customs duties are implemented as announced and remain in place for a long time, they are all equal, we expect the deterioration in the economic view to become part of our economic assumptions in the second quarter, or the more this is implemented, or the more it is implemented, however, so far I feel satisfied with the place where we landed. “

White, who has a relatively unique opportunity to interact with customers on both sides of the border because of the large BMO dependent on business in the United States, said the levels of anxiety are “slightly higher” in Canada.

“This does not mean that there are no anxiety in the United States as well, with people who are also looking for certainty to the extent that they are trading outside the American borders, which applies to many of our customers, he said.

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White said that the current situation is “frustrated” for many people, including its clients who are trying to predict the place of all of this in the end to landing. He said he was often reminded of talks with clients that none of these issues lasted 24 days ago.

He said: “We are just 24 days away, and the age of any prediction in these 24 days was about 24 hours.” “Therefore, it is difficult to know the location of all this.”

The tariff threats prompted people to retract borrowing in commercial banking businesses, but the matter is different on the mortgage side, the head of Canadian banking services in Scotiabankand Aris Bogdanrice said.

“It is interesting, with low prices, it begins to see this pent -up demand in the mortgage field begins,” he said. “However, if the customs tariff is implemented, and of course the economy contracts are probably, you see that mortgage works also begin to decline, but we do not see that yet.”

• Email: nkarim@postmedia.com

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