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Canada's banks unlikely to be impacted by US banking crisis: analysts
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Canada's top six lenders have ample liquidity and manageable credit risks which will help them to emerge largely unscathed from the crisis of confidence that has rocked the global banks over the last two weeks, analysts said on Monday.
The collapse of two U.S. regional banks- the Silicon Valley Bank (SIVBV.UL) and Signature Bank (SBNY.O) this month –and the Swiss government-brokered deal for UBS (UBSG.S) to buy Credit Suisse (CSGN.S) has raised concerns about the health of global banking sector.
"The U.S. contagion is unlikely to spill over to Canadian banks as the issues in U.S. are unique and specific to certain business models or lending activities," said James Shanahan, banking analyst with Edward Jones to Reuters.
Still, the six big banks have collectively lost 9% or C$57 billion ($41.7 billion) in market capitalization in the past two weeks, according to DBRS Morningstar. In comparison, the U.S. bank index (.SPXBK) has fallen 21.5% in last two weeks.
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