Canada’s biggest banks reported first-quarter earnings this week, covering the three months that ended Jan. 31.Alex Lupul/The Canadian Press
Getting caught up on a week that got away? Here’s your weekly digest of the Globe’s most essential business and investing stories, with insights and analysis from the pros, stock tips, portfolio strategies and more.
Canada’s biggest banks report first-quarter earnings
Canada’s biggest banks reported this first-quarter earnings this week, covering the three months that ended Jan. 31. Bank of Nova Scotia, Royal Bank of Canada, National Bank, Canadian Imperial Bank of Commerce and Toronto-Dominion Bank posted profits that beat analysts’ estimates, even as customers crimp their spending and wait for interest rates to drop. Meanwhile, Bank of Montreal missed analysts’ estimates. The banks have all been building provisions for credit losses – the funds banks set aside to cover loans that may default – since late 2022 as consumers wrestle with high interest rates and inflation, Stefanie Marotta reports. Bankers largely believe relief is coming, but not until later this year when rates are expected to start dropping.
Lynx Air winds down operations
Lynx Air is winding down operations. The discount airline shut down on Sunday after receiving court protection from creditors. It owes $25-million in taxes to the federal government and millions more to suppliers, according to documents filed in an Edmonton court. Passengers were left scrambling to find alternate – and possibly more expensive – tickets after the airline announced its shutdown, while others were advised to contact their credit card company to secure refunds for pre-booked travel. In a recent episode of The Decibel podcast, Eric Atkins explained why discount airlines keep failing in Canada and what that means for flyers looking for a deal.
Businesses investment per worker is back to where it was in 2004
In other news, Canada dodged a recession last quarter. Real gross domestic product rose at an annualized pace of 1 per cent in the fourth quarter, and the economy rebounded from a 0.5-per-cent slide in the July-to-September period, thus avoiding two consecutive quarters of decline, Statistics Canada said on Thursday. But one trend has been plaguing the economy – weak business spending. Business investment fell for the sixth time over the past seven quarters, according to Statistics Canada. Jason Kirby takes a closer look in the latest Decoder.
Alberta introduces new rules barring renewable energy projects on prime land
Earlier this week, the Alberta government introduced new rules barring renewable energy projects from large swaths of prime land. The changes, announced by Premier Danielle Smith and Utilities Minister Nathan Neudorf, will ban new projects from private property the government considers to have excellent or good irrigation capability. It’s the culmination of a regulatory inquiry into the province’s renewable energy planning rules that began almost seven months ago. Industry officials and rural leaders say that the restrictions may not spell the sector’s demise, but lack details in key areas and have been criticized for creating uncertainty, Emma Graney and Jeffrey Jones report.
Is China the future of automaking? A Globe reporter rented a BYD to find out
Seemingly out of nowhere, Chinese auto maker BYD Auto Co. Ltd. has become the hottest name in the auto world, overtaking Tesla Inc. as the top seller of electric vehicles. According to some industry reports, China has dethroned Japan as the world’s top exporter of passenger vehicles – albeit quite removed from North America, since BYD does not sell passenger vehicles in Canada or the United States. The Globe’s Matt Lundy rented a BYD in Germany and drove it about 500 kilometres, round trip, over a day to see what the fuss is all about.
Canadian lawyers lured to the U.S. by bigger paycheques now at a crossroads
A wave of Canadian lawyers were driven to the United States by massive paycheques between late 2020 and early 2022, Robyn Doolittle reports. This pandemic-era period marked a historic time for deal activity on Wall Street. American law firms couldn’t keep up with the work and looked abroad for talent. It’s estimated that anywhere between 100 and 150 lawyers – primarily from Bay Street and mostly at the junior level – made the jump. This southern exodus created a domino effect of vacancies on this side of the border and Canada’s legal profession is still recovering from the “brain drain.” Two years later, some Canadians are interested in returning but facing sticker shock at the compensation.
Now that you’re all caught up, test your knowledge with our weekly business and investing news quiz and prepare for the week ahead with the Globe’s investing calendar.
Abigale Subdhan