Canadian Banks Brush Off Trade War Worries Amid Tariff Uncertainty

Canada's big banks are facing potential economic fallout from the ongoing trade war between Canada and the United States, but executives at major lenders seem unfazed.

The latest earnings reports from Bank of Montreal (BMO) and Scotiabank showed that their vast portfolios of consumer and business loans are exposed to the economic impact of the trade tensions.

Scotiabank CEO Scott Thomson told analysts on a conference call that while the current tariffs imposed by US President Donald Trump directly affect less than one percent of the bank's loan book, the broader economy is still at risk.

'The fundamentals in Canada are pretty good,' Thomson said. 'If you look at the job growth numbers, if you look at the fiscal capacity on the back of oil prices and if you look at some of the activity that's starting because of the prime minister's agenda, you actually have a backdrop that's pretty good.'

Thomson's sentiment was echoed by Bank of Montreal CEO Darryl White, who said the impact of the trade tensions is 'manageable'.