CIBC head calls federal government's new housing measures prudent
A CIBC branch is shown in this file photo. (Chris Fox/CP24.com)
OTTAWA - The chief executive at one of Canada's biggest banks is supportive of a new package of federal measures aimed at easing risks in the country's real estate system.
CIBC's Victor Dodig says government changes announced last week that include tightening mortgage lending rules are prudent and will create stability in the housing system.
Last week, Finance Minister Bill Morneau announced measures designed to slow the injection of foreign cash into Canadian housing markets and stiffen eligibility rules on prospective borrowers. The government also proposed consultations on a policy that would see banks shoulder more of the risk for mortgage default.
Dodig (TSX:CM) says he expects the consultations around so-called "lender risk sharing" will be a constructive one.
He says the goal of the government is to make sure the taxpayer is not on the hook to support financial institutions in a perceived or real way.
Morneau's announcement last week came amid concerns that real estate costs in the hot Toronto and Vancouver markets are out of reach for many Canadians. Some fear foreign investment in these areas has helped drive up prices.