Scotiabank Curbs Mortgages in Vancouver, Toronto as Prices Soar

Scotiabank CEO: 'Took Foot Off Gas' for Canada Mortgages

Hot housing markets in Vancouver and Toronto prompted Bank of Nova Scotia to ease off on mortgage lending in those cities, Chief Executive Officer Brian Porter said.

“We’re a little concerned about housing prices in the greater Vancouver area and Toronto," Porter, 58, said Tuesday in an interview on Bloomberg TV Canada. “We just took our foot off the gas the last couple quarters in terms of mortgage growth for the reasons I cited, in terms of Vancouver and Toronto."

Nationwide home sales in April jumped 10.3 percent from a year earlier, the most activity for that month and the second-highest level ever, according to the Canadian Real Estate Association. In Vancouver, prices rallied 25 percent in the month to an average of C$844,800 ($643,000) and sales climbed 15 percent. Toronto prices jumped 13 percent to C$614,700 and sales rose 7 percent, the association said.

Scotiabank, Canada’s third-largest lender by assets, had less growth in mortgage loans in the quarter, Porter said. Still, the quality of the loans and trends remain strong and the bank is comfortable with its position, he said.

“Generally, Canadians have a strong ability to self regulate and they’ve demonstrated that before," Porter said.

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