Bankrupcies; Meh…

The latest figures from the Office of the Superintendent of Bankruptcy Canada released on January 10, 2019 show the number of Canadian businesses and consumers financially going under jumped significantly in November 2018 compared to a year ago. Alberta continues to lead the nation. Total insolvencies in Alberta in November 2018 — including bankruptcies and proposals were up 20.2 per cent in comparison to November 2017. As discussed in our previous post Canadians owe $1.775 in credit market debt, which includes consumer credit and mortgage and non-mortgage loans, for every dollar of household disposable income in the third quarter. Not…

Canadians; CRAZY in love with debt

As a collection agency with offices in Edmonton, Calgary and the GTA we recognize that the vast majority of consumers we inevitably end up dealing with are good people, with good intentions, that have now simply arrived at the tipping point of having to either try to continue to rob Peter to pay Paul or, in the alternative, to make some hard choices in monthly budgeting in order to honour their outstanding financial obligations. On our note above its no surprise to see that the amount Canadians owe relative to their income ticked higher in third quarter of 2018! Statistics…

Harbinger of Turmoil: When the Bank of Canada Buys

debt collector alberta
As a collection agency with offices in Edmonton, Calgary and the GTA we are watching with keen interest the unfolding of the following events with respect to their impact (or lack thereof) on Canadian credit markets. In mid November the Bank of Canada (BOC) announced for the first time that they would look to start buying government-backed mortgage bonds, also known as Canada Mortgage Bonds which are guaranteed by Canada Mortgage and Housing Corp.  Well, it took less than a month for the BOC to execute on its intentions, because yesterday, the central bank purchased Canada Housing Trust bonds for…

Differing Degrees of Misery is still Misery

Just how much money do you need to be among the global 1 percent? According to the 2018 Global Wealth Report from Credit Suisse Research Institute, you need a net worth of $871,320 U.S. or $1,141,429.20 CDN using an exchange rate of 1.31 as of the time of this post. Credit Suisse defines net worth, or “wealth,” as “the value of financial assets plus real assets (principally housing) owned by households, minus their debts.” From page 29 of the report specifically addressing Canada, the average wealth per adult in Canada, at USD 288,260 ($377,620 CDN), is 29% lower than that…

Consumer Cannon Fodder

Good news for long abused savers while long favoured debtors are nudged a little closer to the precipice. It appears overindebted Canadian consumers can now officially consider themselves nothing but cannon fodder at the Bank of Canada. Governor Stephen Poloz and his deputies on the Governing Council raised the benchmark interest rate a quarter-point to 1.75 per cent today, as expected.  Considering the move, we anticipate as a receivables management firm default rates will slowly rise. They said they feel pretty good about the economy, now that politicians in Canada, Mexico, and the United States have agreed on a revised…

CPA Survey of Employees

More evidence was released in September that an alarming proportion of Canadians are in financial quicksand. The Canadian Payroll Association’s annual survey shows 40 per cent of working Canadians feel “overwhelmed” by their debt, with more than one-third of respondents saying they loaded up on leverage over the last year. (Will we ever learn). Meanwhile, one-fifth of respondents said they wouldn’t be able to scrape together $2,000 within a month in case of emergency. Other disturbing data points include: • 44% of Canadians live pay cheque to pay cheque • 46% say financial stress is impacting their workplace performance •…

A Deeper Dive on Business Bankruptcies/Proposals

Has your company experienced an uptick in once good paying commercial customers suddenly going past due, into CCAA protection or bankrupt? As a collection agency operating in Edmonton, Calgary and the GTA we can help. Our intent is not to fear monger or spread doom and gloom. We’re not economists. Nor do we consider ourselves thought leaders by any stretch of the imagination however, our purpose is to hopefully provide some additional considerations for those who are interested in gaining the best possible understanding of our world beyond the headlines. As reported by the ATB Owl last week (businesses) insolvencies…

Consumers worried? Really?

Nearly 60 per cent of Canadians have changed their behaviour by doing things such as cutting back on spending on both extras and essentials to brace themselves for rising interest rates, a new survey from Manulife Bank suggests. As a collection agency operating in Edmonton, Calgary and the GTA we recognize that the vast majority of consumers we inevitably end up dealing with are good people, with good intentions that have now simply arrived at the tipping point of having to either try to continue to rob Peter to pay Paul or, in the alternative, to make some hard choices…

Understanding Tin Foil Hats

Never judge a man by the fact that he may be wearing a tin-foil hat. Rather seek to understand the reasons why. We found one such item that, either downplayed or completely absent from the mainstream, may drive some to question true reality from the reality that the masses are fed. As a collection agency specializing in accounts receivable management we are watching with keen interest the unfolding of events with respect to the following four phenomenon and their impact (or lack thereof) on Canadian credit markets. Impaired Mortgages Soar at Canadian Banks A new accounting framework adopted by Canadian…

Debt Trap!

The day of reckoning for over indebted Canadians does not appear to be coming soon, but a new survey indicates a rising proportion of Canadians fear the fallout from higher interest rates. Thirty-three per cent of respondents to a survey conducted on behalf of MNP said they could be pushed toward bankruptcy due to rising rates.   That’s up five percentage points over the last six months. The Bank of Canada has raised interest rates three times since last summer, taking its benchmark policy rate to 1.25 percent. Although the Bank of Canada announced on April 18, 2018 that Canada’s key…