publisher’s message by Dan Donovan
THE SHAMEFUL BEHAVIOUR OF
Canada’s greedy banks "The man who has won millions at the cost of his conscience is a failure." -
anada’s banking sector is an oligopoly consisting of six C large banks (‘The Big 6’) who control an overwhelming proportion of the banking business across the country. They
gouged out record profits of more than $46 billion in 2019 – the tenth year in a row, and more than doubled their 2010 profits in part by firing thousands of people, shifting jobs overseas (or using temporary foreign workers), cutting services, and hiking fees and credit card interest rates even as the Bank of Canada’s prime rate dropped to record low levels.
B.C. FORBES
structured these ‘deferrals’ assures that interest accrued from each deferred payment will be added back into the principal balance of the mortgage. Essentially, the bank is loaning customers the amount that they would have paid in interest during the deferral period and will then charge them back the interest on that loan as well. Customers will end up worse off in the end paying interest . . . on the interest, plus the loan itself. Cynically, the banks will then increase many of their customers' payments at the next mortgage renewal cycle due to the increase in mortgage balance, which the banks facilitated through this opprobrious policy in the first place.
The Big 6 Banks paid their CEOs a gluttoness $75 million, in 2019, in salary and bonuses. Toronto-Dominion Canada Typically, The Canadian Bankers Association, who never miss Trust CEO, Bharat Masrani, received the highest overall pay an opportunity to live up to the old Brian Mulroney adage for the 12 months ended October 1, 2018 raking in $15.3 that “there is no whore like an old whore”, put out a release million in total compensation on profits of over $11.7 billion. to justify this avarice saying “Customers should understand Royal Bank of Canada CEO, Dave McKay, took home $14.5 that [a deferral] is not mortgage forgiveness. Mortgage million on approximate profits of deferral means that payments $12.9 billion. Bank of Montreal are skipped for a defined period Canada’s Big 6 Banks mortgage CEO, Darryl White, was paid $10.1 of time, during which interest million on profits of approximately which would otherwise be part deferral programs are all similar $5.8 billion, while Canadian of the deferred payments is added and specifically designed Imperial Bank of Commerce CEO, to the outstanding balance of the Victor Dodig, pulled in $10 million mortgage.” In short, the behaviour to ensure they lose no money on profits of approximately 18.6 of the Big 6 Banks and their in the short term, and in fact make CEO’s is organized loan sharking billion. Bank of Nova Scotia CEO, Brian Porter, raked in $13.3 million profits while royally screwing over and kleptocracy. It is a modern on profits of $8.8 billion while day version of ‘let them eat cake’. consumers who will end up paying All six CEOs should be put on a Louis Vachon, President and CEO of National Bank of Canada, was stage and publicly shamed for their more to them in the longer run. remitted 8.1 million on profits of gluttony and cupidity. $2.3 billion. Contrast this behaviour with that of the small but mighty It’s no surprise to find that these corporately cuddled, Vancity Bank, a values-based financial cooperative with more entitled, overpaid administrators of an oligopolistic entity than 534,886 member-owners and the only bank in Canada have completely failed in their response to the COVID-19 with a meritorious response for its customers’ needs regarding crisis, the Black Swan event that is proving to be the worst COVID19.Vancity is providing personal and business creditglobal calamity of our lifetime. Only after some prodding by card-holders who need to defer a payment due to the impacts the government did the tone-deaf potentates running the Big of the COVID-19 pandemic. These payment deferrals are 6 Banks announce temporary mortgage and loan deferrals for up to six months at a zero-per-cent interest rate. Vancity and cuts to some credit cards and fees, for some of their instituted this policy on their own. Only after media reports customers. A review by Ottawa Life Magazine, the CBC, other and some pressure from the government did the Big 6 Banks media companies and Democracy Watch shows it’s all smoke agree to cut their credit card rates by 50 per cent in the short and mirrors — a cynical ploy designed to further enrich the term.The problem is that they are already charging outrageous banks in a crisis at the expense of an exasperated citizenry. interest rates to most customers that are on average between 18 and 30 per cent. They will offer ‘customers’ six months of Canada’s Big 6 Banks mortgage deferral programs are all deferral payments on credit cards. When customers resume similar and specifically designed to ensure they lose no their payments after 6 months, their first minimum payment money in the short term, and in fact make profits while will be all the interest they have accumulated over the sixroyally screwing over consumers who will end up paying month period plus fees and additional percentages where more to them in the longer run. The manner in which they applicable.You’d get a better deal from Tony Soprano. 4 OTTAWALIFE SPRING 2020
