Richard Black­well – Globe and Mail

Royal Bank of Canada chief Gor­don Nixon says he is “incred­i­bly pos­i­tive” about the out­look for the Cana­dian econ­omy despite the prob­lems bub­bling up around the globe.

“The next num­ber of years is going to be a dif­fi­cult period for the world,” the chief exec­u­tive offi­cer told a Bloomberg con­fer­ence in Toronto. How­ever Canada “is incred­i­bly well posi­tioned” because of its fis­cal flex­i­bil­ity, its low tax rate, nat­ural resources, strong finan­cial sec­tor and grow­ing indus­trial sector.

“We have abil­ity to really buck the trend” of what is going on else­where, he said, par­tic­u­larly because the coun­try is less reliant on the United States than it was in the past.

Mr. Nixon said he is not con­cerned about a hous­ing bub­ble that may burst.

“We feel pretty good about the hous­ing mar­ket,” he said, not­ing that Vancouver’s condo mar­ket is not rep­re­sen­ta­tive of the entire national hous­ing mar­ket. RBC also has rel­a­tively lit­tle expo­sure to the condo mar­ket, he added.

There are pock­ets of vul­ner­a­bil­ity, but over all, the bank is com­fort­able with its mort­gage lend­ing, Mr. Nixon said. The only worry would be a “shock from a sig­nif­i­cant increase in inter­est rates over a short period of time,” he said.

Indeed, Mr. Nixon said he would “like to see the rhetoric [about a hous­ing bub­ble] come down a lit­tle bit.”

Mr. Nixon said RBC, which has been more cau­tious about over­seas acqui­si­tions than many of its com­peti­tors, will remain that way. It will look at “strate­gic, tac­ti­cal” acqui­si­tions, but only ones that can present a rea­son­able rate of return.

All banks are look­ing to more cap­i­tal growth in the cur­rent uncer­tain envi­ron­ment, so the buy­ing action that took place from 2000 to 2008 will not be repeated for some time, he said.

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Lau­rin & Natalie Jef­frey are Toronto Real­tors with Cen­tury 21 Regal Realty.
They did not write these arti­cles, they just repro­duce them here for peo­ple
who are inter­ested in Toronto real estate. They do not work for any builders.
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