In early 2001, we were expecting that the slowdown in both the U.S. and Canadian economies would be modest. In Canada, an earlier announced tax cut was fortuitously coming into effect. It was not until the middle of last summer that it became evident that the Canadian economy was undergoing a more pronounced slowdown than we had expected.
The impact of the marked deterioration in the wider economy on the banking sector is a key concern. However, recent Government actions with respect to the banking system demonstrate a commitment to take whatever measures are necessary to stand behind the financial system.