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Toronto-Dominion Bank (The) (TD)
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Bank of Nova Scotia (The) (BNS)
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Canadian Imperial Bank Of Commerce (CM)
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Flagstar Financial Inc. (NYCB)
Q: The US commercial property crisis has become hot topic again and the share price of New York Community Bancorp decline a lot . Please comment on the impact on these banks. Thanks a lot.
5i Research Answer:
Other than investor sentiment and worry, the Canadian banks should see little fall out. NYCB seems to be an isolated case as it has specific new reserve requirements and could not meet them without cutting the dividend. Canada's banks have real estate exposure, of course, but it is being managed OK, and with rates set to pivot the problem should, at least, not get any worse than it was last year. Canadian banks still have recession and other risks, but in terms of specific risks to what's happening in the US we think they will not see issues.