WatchCanadian household debt hits 18 trillion as global watchdog warns of risks

TORONTO — Canadians’ collective household debt has climbed to $1.8 trillion as an international financial group sounds an early warning that the country’s banking system is at risk from rising debt levels.Equifax Canada says consumers now owe $1.821 trillion including mortgages as of the fourth-quarter of 2017, marking a six per cent increase from a year earlier.Although nearly half of Canadians reduced their personal liabilities, roughly 37 per cent added to their debt to push the average amount up 3.3 per cent to $22,837 per person, not including mortgages.Canada flagged as one of three nations most at risk of banking crisisThree real-life signs that interest rate hikes are already starting to biteMillennials are ditching credit cards, and it’s threatening the entire industryThe fresh numbers come as an international financial group owned by the world’s central banks says Canada’s credit-to-gross-domestic-product and debt-service ratios show early warning signs of potential risk to the banking system in the coming years.The latest report by the Bank for International Settlements says Canada’s credit-to-GDP gap and debt-service ratios have surpassed critical thresholds and are signalling red, pointing to vulnerabilities.The group, however, cautions that these indicators should not be treated as a formal stress test, but as a first step in a broader analysis. read more