The chief executives of the country’s most prominent banks think
However, they say the coming weeks don’t look pretty because growing numbers of Canadians are continuing to contract the virus.
"In the short-term things are going to be not as good as one might have hoped, but overall I think we are in a probably slow way of getting more positive as the year goes by," TD chief executive
Masrani made his comments during a virtual appearance at
They all agreed that
Vaccines will be key, they said.
"We believe roughly four and 4.5 million high-risk Canadians will have to be vaccinated before we can really get back to reopening the economy and we can achieve that within 100 days, if we have the vaccines,"
The number of doses of COVID-19 vaccines administered in
Once people are vaccinated, McKay believes those who have been sitting on cash and not spending it because so many things are closed will race back to pastimes like travel and entertainment.
But timing around when that will happen is still a big question.
Most businesses in provinces like
"We are looking into the following fiscal year before you are seeing any robustness there," he said.
Masrani thinks some consumers will encounter credit trouble in the later half of 2021 or even into 2022, so he's baking negativity into TD's economic models.
While
"We are just not seeing the impaired losses coming in at the rate people would have expected," he said.
Rent relief, mortgage deferrals and wage subsidies have helped many Canadians manage the crisis and banks have built up large reserves to take care of bad loans that may transpire, he said.
For a rebound to really take shape, McKay believes government relief will have to continue and become focused on areas of the economy that are expected to take longer to recover like small businesses, hospitality businesses and transportation companies.
When a rebound comes, so will change at banks.
Dodig has noticed people shift rapidly to online banking during the pandemic and even those who were using digital options before the virus began circulating are moving more of their transactions online.
CIBC recently transformed 250 or one quarter of its banking centres into advice centres because digitization was accelerated by the health crisis, he said.
McKay said that many bank branches have been temporarily closed or operating with reduced hours throughout the pandemic.
RBC has closed some branches and McKay expects to pare back another three or four per cent over the coming year, he said.
That equates to between 30 and 50 branches, according to McKay.
He believes branch footprints can be reduced and the bank can get more flexibility by focusing on shorter leases, but how it should approach branches will depend on the recovery.
"Everything is positioned to watch how clients come back and how they use the branch," he said.
"A lot of client activity still goes through our branches, but we will see what sticks with consumers and what changes through all of this."
This report by
Companies in this story: (TSX:RY, TSX:BMO, TSX:CM)
© 2021 The Canadian Press. All rights reserved., source