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Bank buildings tower over the corner of Bay Street and Adelaide streets in Toronto.
Bank buildings tower over the corner of Bay Street and Adelaide streets in Toronto.
(Gloria Nieto/The Globe and Mail)

Why the rally in Canadian bank stocks is unlikely to keep going

It’s too early to state definitively that Canadian credit growth has rolled over. But, for investors in domestic bank stocks, it’s not too early to start worrying about it.

The chart below compares the year over year growth of total Canadian loan activity to the performance of the S&P/TSX Bank Index.