Tag Archive for: CIBC

Who is calling the shots?

Unless you were living under a rock or had your head in the sand, you probably know that most of the central banks lowered their key lending rates yesterday by 50 basis points. This was in response to the ongoing financial crisis that seems to be gripping the world.

The strange part for us Canadian’s is that usually when the Bank Of Canada lowers it’s key lending rate, the major banks usually follow with the same immediate cuts to their prime rate. However this did not happen yesterday, the Bank of Canada drops the rate by 50 basis points and the major banks only cut their prime rate by 25! Their reason for the rebellion, they say according to a Globe & Mail article is that they are already feeling too much pain because of an increase to their lending costs.

How many billions of dollars were injected into our financial system in the past few weeks? How many more do they need? Our banking system is vastly different and more stable than  our friends in the US. Where they have hundreds of banks, we have 5 large players. 

These banks can not possibly be suffering as much as the small business owners and countless home owners across the country who really need the to reduce their borrowing costs. It just looks like they are putting their profits ahead of what is good for their clients.  I am hoping that this is only temporary, if they do this again, then what would we really need a central bank for if our banks are just going to march to the beat of their own drum.

Cheers,

Pat

  

It's not me, it's the economy!

According to an article in the Globe and Mail this morning it says we are carrying too much debt in comparison to our assets. However don’t worry CIBC conomist Benjamin Tal said that it is because of the economy! So let me get this straight, we are spending more than we make, putting ourselves deeper in debt and it is not really our fault it is the economy. He is right about one thing, the economy is not as rosy as it was just few short years ago. That should not be an excuse to over do it! What people fail to realize is that we make this economy go round, and if we are forced to cut back our spending to keep up with our debt service needs, what will happen then?

The point that I am trying to make is this, we are responsible for our own situation. We are where we are because of the choices that we have made, good or bad. Some thing that I have just read recently sums this all up ” We are not our circumstances, our circumstances are us! When we change, then our circumstances change”. If we want things to change, then we must first change!

Cheers,

Pat

 

Investors sue CIBC over subprime exposure

 

A group of investors has become the first to launch a class-action lawsuit againstCanadian Imperial Bank of Commerce, alleging misrepresentations about the bank’s exposure to the American subprime mortgage market. The claim alleges that the bank misrepresented its total exposure to U.S. subprime loans by saying it “was ‘not a major issue’ when, in fact, the bank had exposure to billions of dollars of losses.” The suit was filed with the Ontario Superior Court by Toronto’s Rochon Genova LLP. Lawyer Joel Rochon said that CIBC “ignored its legally required disclosure obligations to the detriment of the investing public.” CIBC denied the allegations. “CIBC is confident that, at all times, its conduct was appropriate and that its disclosure met applicable requirements,” spokesman Rob McLeod wrote in an e-mail. CM (TSX) rose $3.17 to $63.29. CP