The bank has been under scrutiny from the OFSI after a routine regulatory audit conducted by OSFI, revealed breaches in rules that limit how indebted borrowers can be within their mortgage portfolio ...
Thousands of clients were said to have lines of credit or home equity secured against their homes which when combined with a CIBC mortgage pushed them above acceptable thresholds for total debt obligations relative to their home’s value or income ...
The issue initially affected retail clients but has since expanded to include those within the bank’s Simplii financial brand, CIBC's digital-only banking subsidiary ...
It seems to me that with increasing interest rates, which in-turn lead to higher mortgage rates, these properties could soon be pinched into bankruptcy. The massive loss of all the loaned equity the CIBC would suffer if the housing bubble pops would be extremely damaging to it's financial security. Could the CIBC be in danger of receivership?
Full story Here.
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