Canadian banks have healthy balance sheets and absolute leverage that is significantly lower than many of their international peers. They are less exposed than their U.S. counterparts to the subprime-mortgage market that is at the root of the market turmoil, and are less dependent on securitization for their financing and on capital markets for their revenues.
That strategy should be successful if, as I have outlined, growth ahead is moderate and inflation pressures are contained. Such a strategy has advantages.