This really irritates me.

[DaveP]

I think many of you know I'm a Conservative, but I don't believe they're above criticism.

And this p's me right off!

Canadian banks got $114B from governments during recession

Canada's biggest banks accepted tens of billions in government funds during the recession, according to a report released today by the Canadian Centre for Policy Alternatives.

Canada's banking system is often lauded for being one of the world's safest. But an analysis by CCPA senior economist David Macdonald concluded that Canada's major lenders were in a far worse position during the downturn than previously believed.

Macdonald examined data provided by the Canada Mortgage and Housing Corporation, the Office of the Superintendent of Financial Institutions and the big banks themselves for his report published Monday.

It says support for Canadian banks from various agencies reached $114 billion at its peak. That works out to $3,400 for every man, woman and child in Canada, and also to seven per cent of Canada's gross domestic product in 2009.

The figure is also 10 times the amount Canadian taxpayers spent on the auto industry in 2009.

"At some point during the crisis, three of Canada's banks — CIBC, BMO, and Scotiabank — were completely under water, with government support exceeding the market value of the company," Macdonald said. "Without government supports to fall back on, Canadian banks would have been in serious trouble."
...

To show the scale of the funding, the CCPA report contrasted the total value of the support Canadian banks took against the bank's total value at the time. Under that comparison, CIBC received $21 billion in support — almost 1.5 times the value of the company at the time. BMO maxed out at $17 billion or 118 per cent, Scotiabank peaked at $25 billion or 100 per cent of its value, while TD and RBC maxed out at $26 billion and $25 billion — good enough for 69 and 63 per cent, respectively, of the total value of those companies at the time.

"It would have been cheaper to buy every single share in these companies," Macdonald said.

And we were told at the time our banks were just fine and didn't need bailouts. Instead we, the taxpayer, gave them more money than they were worth? $3,400 for every person in Canada? And we don't own them? And we're just finding out about it now?

[glowworm2k]

A lot of the events of late are getting close to making me pick up a pitchfork and light a torch - all those on parliament hill better watch out . My grandfather used to have a saying about politicians and bankers... "They talk out of both sides of their mouths" - meaning that they often say one thing and do another and thus can't be trusted. This seems like a definite case of some gov't/bank double-speak and I can definitely identify with your anger as I share it.

[Patty Smyth]

I heard about this as well yesterday. Not too pleased with it either. I believe that any party probably would have done the same thing though, not just the PC's.

[DaveP]

I heard about this as well yesterday. Not too pleased with it either. I believe that any party probably would have done the same thing though, not just the PC's.

I can almost understand hiding the seriousness of things to stop a panic which would make things worse, but Lord Almighty that's a lot of my and your money! Family of 9 here, so that's over $30,000 added to the deficit we're responsible for (plus interest). Spent without our consent. I hope the government is able to recover some of that from the banks huge profits that they're also taking from us.

[Patty Smyth]

I think you are right about not letting panic set in though. It was my first thought when I heard this. I can't understand how it was keep under wraps though and how did the banks possibly profit from this also? Beyond the fact that none of them fell. By doing this they also manipulated the stock market into a false sense of security. Interesting if more things come out. Those at the very top must certainly have gotten wind of this. I also can't help but think that if I were a multi million dollar stake holder in bank stocks and mutual funds I would want to be told to not worry "it's taken care of" KWIM? People knew, they just didn't talk. When I say people I mean billionaires, millionaires and politicians.

[TaraF]

I wanted to say something when I read this yesterday but refrained as I don't want to come across as a Political Hot head who is only after Harper so I didn't start a thread on it. But I agree Dave, it's infuriating. I mean Harper has been travelling the world touting how awesome our banking system is and how it survived the recession and other Countries have looked to us to mimic what we're doing and the whole time they lied to Canada and the world.

And when things like this come to light it adds to the growing list of issues people do have with the Government. And Patty while whatever Party in power may have done the same thing, it certainly doesn't make it right.

[Patty Smyth]

I wonder if people are more mad now that they know they were lied to or would they have been more angry if they knew the banks needed a bailout at the time. Keeping in mind the record profits they seem to post every year.

[saveadollardiva]

It doesn't surpise me. I understand what people are saying about not causing a panic, but come on. At least tell the public were their tax dollars are going? I would be fine with my tax dollars going to the banks to help keep the canadian economy going. Just be honest about it. The government always has something to hide.

[DaveP]

I wonder if people are more mad now that they know they were lied to or would they have been more angry if they knew the banks needed a bailout at the time. Keeping in mind the record profits they seem to post every year.

Part of my anger (besides having over a 100 billion of my dollars wasted) is that we were told at the time that the reason our banks weren't in any trouble while worldwide banks were was that our banks were regulated in Canada so we didn't have sub-prime mortgages. So our banks weren't vulnerable. Yeah. Except our banks lent to the American ones that DID have sub-prime mortgages and offered mortgages to folk who couldn't afford them here too.

As my many Newfie friends would say - it just rots my shorts.

A lot of people have been hurt. And we'll have to pay for it for a long time.

[MortgageQueen]

Didn't that same article say the Gov't denied the whole thing? . . . .

[Patty Smyth]

burns the phrase "rots my shorts" in my little head for future reference, thank you Dave that's a new one on me

[lekate]

I'm so glad that I can continue to wallow in debt so that those poor banks can continue to post record profits, I mean really, we have to all help each other out. Banks are corporations, which means they're people too, they have feelings, wouldn't want them to get hurt for failing.

[i_forget]

This is not "new" news. I think a lot of people are mad because the entire situation has pretty much been forgotten about and it is now resurfacing with a bit of a twist here and there.

The government did pump money into the banks when this happened because the banks were threatening to "close up shop" and tighten the flow of credit, which at the time would have killed our economy and put Canada into the same hole as the States. The money was used to ease credit restrictions so that things could continue as close to normal as possible so that our economy would not take a trip into the toilet.

Not too sure why they are implying it was a big secret. It was not it. It has been forgotten about for sure, but it was no secret.