High risk? No thanks
Posted Jul 14, 2010 04:09:21 AM.
This article is more than 5 years old.
Banks are cashing in on a trend that’s seeing recession-battered Canadians turn away from high risk investments.
Financial services consultant David McVay says this year Canadians have opened about 20 per cent more chequing and savings accounts than last year.
He says that’s a giant leap from the average three to five per cent annual increase.
McVay says Baby Boomers are jittery when it comes to investing in stocks after the financial meltdown decimated their retirement investments.
And, he says the banks are looking to capitalize on that because they can make more money from savings accounts than when stocks are in vogue.
McVay says the 20 per cent increase in retail accounts amounts to about $100 billion dollars in business.
T-D Bank economist Grant Bishop agrees the trend away from risky equity markets has increased competition for deposits.
But he says the rush into precautionary savings during the initial phases of the recession has since dropped off.
