TRUST — FOR A PREFERRED SHARE
Canada’s trust companies have been lucky as well as clever. Their larger banking brethren have struggled with portfolios full of Latin American, energy and agricultural loans. Banking confidence has not yet recovered from the crash of Canadian Commercial bank and Northland.
Canadian regulations ensure that trusts must invest the bulk of their assets in high-quality, well-secured loans. They are out of the sovereign risk market. Their ability to make commercial loans is restricted, which makes it harder to lose money on lousy credit decisions.
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