Commercial Banking in Canada
Despite certain adversity that emerged as a result of the global financial crisis, the Commercial Banking industry in Canada had an impressive performance over the five years to 2018. Banks have done an exceptional job of diversifying revenue streams and overcoming limits imposed by low interest rates and increasing regulations. The industry primarily generates revenue through interest income sources such as business loans and mortgages, but it also generates income through noninterest sources, which include fees on a variety of services and commissions. Industry revenue generated by interest income sources depends on demand for loans by consumers and the interest banks can charge on that capital it lends out. Therefore, low interest rates over the past five years have limited the price banks can charge for loans. Over the five years to 2023, projected increases in interest rates and improvements in corporate profit are anticipated to boost interest income from lending products.
Operators in this industry provide financial services to retail and business clients in the form of commercial, industrial and consumer loans. Banks also accept deposits from customers, which are used as a source of funding for the loans. Banks in this industry include those that are regulated by the Office of the Superintendent of Financial Institutions.
This report covers the scope, size, disposition and growth of the industry including the key sensitivities and success factors. Also included are five year industry forecasts, growth rates and an analysis of the industry key players and their market shares.
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