"Commercial loan growth to resume in H2 2010"

Good news, borrowers! According to an equity research report I read this morning, at least one domestic bank believes that the end of the credit crunch is almost upon us. As the year has progressed, we’ve tracked the monthly stats of the Bank of Canada (see prior post “Commercial bank loans drop $2.6 billion in September” October 24-09) to keep you all current on the state of the commercial and corporate loan market. Here’s a quote from Genuity Capital Markets bank analyst in reference to the current earnings reporting cycle:

“Management expects higher capital standards (potentially announced in the next 30 days) and a resumption of growth in the commercial book in the second half of 2010 to soak up the accumulation of excess capital.”

For Canadian banks, H2 begins in May. If this insight reflects broadly across all domestic banks, the credit taps may begin to open up in a matter of months.

MRM