Canadian banks have strong balance sheets, right?
Canadian banks are conservative, right?
Canadian banks eased through the financial crisis unaided, right?
Does the table below change your mind?
This shows the government support (Bank of Canada, CMHC, US Federal Reserve) received by the big Canadian banks during the crisis. More importantly, this shows the proportion of support to market cap. It turns out that some banks received support that EXCEEDED the market value of their equity.
Moral of the story: the bursting of the Canadian housing bubble could have a serious impact on the Canadian financial system.
Read the full report