CIBC CEO says mortgage aid for homeowners sustainable for ‘foreseeable future’

Bank has about $52 billion of variable-rate mortgages with monthly payments that aren't even covering interest

CIBC chief executive Victor Dodig says mortgage aid can continue because most borrowers have significant equity in their homes and built up extra savings during the pandemic. Photo by Christopher Katsarov Luna/Bloomberg

Such accommodations — a response to one of the most aggressive rate-hiking campaigns in the Bank of Canada’s history — can continue because most borrowers have significant equity in their homes and built up extra savings during the pandemic, Dodig said. Canadian regulations also required many homeowners who borrowed years ago to qualify at today’s higher rates, meaning they have the ability to make higher payments, he said.

“Our clients are making rational decisions,” Dodig said in an interview. “They’re either adjusting their payments, or they may be extending their amortization. For those that are renewing, they’re renewing on a shorter-term basis because they believe that interest rates may decrease.”