Economic Crisis Spurs Canadians To Change Spending Habits

Toronto, Ottawa (AHN) - Because of the shift of Canadian spending habits with more residents saving instead of purchasing, banks are adjusting their products and services to suit the shift.

Bank of Montreal chief executive officer Bill Downe projected lower demand for loans and higher deposit growth for 2009 after the bank increased its market share of deposits.

A similar spurt in savings was observed by the Bank of Nova Scotia, said Chris Hodgson, head of domestic banking, with Canadian depositors opting to park their money in high-interest savings account. When the bank starts to accept tax-free savings deposits, he expects more funds to be channeled to this type of account.

According to a survey by the Boston Consulting Group 62 percent of Canadians said they intend to spend less in 2009.