For the moment, the economic disruptions linked to the Omicron variant should not have too great an impact on the National Bank, believes Laurent Ferreira, its president and chief executive officer.
“When you look at the sectors most affected, it’s more consumer discretionary and leisure,” said the leader during a virtual presentation hosted by RBC Capital Markets. These are areas where we have very low exposure. “
He said the financial situation of the majority of his clients was good. He added that household savings are robust and the business loan portfolio was “well diversified”.
Mr Ferreira said it was still too early to know Omicron’s financial impact on the economy and household spending. He anticipates that the restrictions announced by the Quebec government should be lifted in “the coming weeks”.
The National Bank will also have to deal with the rise in inflation in 2022. The increase in salaries puts pressure on the payroll of the Montreal financial institution. On the other hand, an increase in interest rates is generally favorable for bank margins. Unless the economy finds itself in a stagflationary situation where supply chain disruptions exacerbate inflation while dragging down the economy, Ferreira believes inflation will be generally favorable for the economy. the bank. His team anticipates three interest rate hikes by the end of fiscal 2022 (October 31, 2022).
It was the first public address of the new big boss of the National Bank, since taking office in November.
Management will continue to invest in its “digital transformation”. Mr. Ferreira noted that the digital strategy of the National Bank, deployed in 2016, has improved its efficiency. “There are still improvements to be found. “
Growing outside of Quebec is an important strategic objective for us, and it is not a problem for us
The banker said he plans to increase cross-selling opportunities between the wealth management, private banking and business services divisions. “We see a ton of potential synergies, and our intention is to make these lines of business work more together. “
The leader reiterated that he saw opportunities for growth in Canada, both in Quebec and in the other provinces. He recalled that capital market activities garnered the majority of their income outside the province. He pointed out that the financial institution already had expertise in certain business segments such as health, agriculture and technologies outside the province. “Growing outside Quebec is an important strategic objective for us, and it is not a problem for us”, replied the leader.
When unveiling the most recent quarterly results in November, Ferreira said he did not plan to make acquisitions in emerging countries, even though ABA Bank, the Cambodian bank that Nationale owns, recorded strong growth.