2018 Financial Performance
Household Debt: Canada vs. U.S.
Canadian households' balance sheets compare favourably to US
Canadian debt-to-income ratio is now 5.5% below the U.S. peak in 2008
In the last 7 years, increases in Canadian debt-to-income ratio have slowed vs. 2002-10
Calculated on the same terms, Canada's debt-to-income is currently 164% vs. 134% in the U.S.
Canadian debt-to-assets ratio remains below U.S.
o U.S. households have incentive to pursue higher asset leverage in light of mortgage interest deductibility
o Debt is a stock concept, to be financed over one's lifetime. Income is a flow concept measuring
one single year's earnings. Debt should be compared to lifetime or permanent income, or assets
• Ratio of total household debt-to-GDP remains lower in Canada than U.S.
。 Calculated on a comparable basis, the ratio of household credit market debt is 98.2% in Canada vs. 101.3% in the U.S.
Household Credit Market
Total Household Liabilities
Debt to Disposable Income
180
30
household credit liabilities
as % of disposable income
169.1
160
163.6
25
140
120
100
80
60
133.8
20
20
......
Adjusted Canadian*
15
Official Canadian
Official US
90 92 94 96 98 00 02 04 06 08 10 12 14 16 18
* Adjusted for US concepts and definitions.
Sources: Scotiabank Economics, BEA, Federal
Reserve Board, Statistics Canada.
10
As % of Total Assets
household debt
as % of assets
US
Household Credit Market
Debt to GDP
130
% of GDP
120
US with
110
unincorporated
business debt
102.7
100
Original Canada
101.3
98.2
90
Canada*
18.0
80
Canada
70
16.7
75.1
Original
US
60
50
90 92 94 96 98 00 02 04 06 08 10 12 14 16 18
Sources: Scotiabank Economics, Federal
Reserve Board, Statistics Canada.
90 92 94 96 98 00 02 04 06 08 10 12 14 16 18
* Adjusted for US concepts and definitions.
Sources: Scotiabank Economics, BEA, Federal
Reserve Board, Statistics Canada.
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