Calgary strongest in paying off loans

REPORT • Consumers in Calgary are rated the best in Canada at paying off debt, with less than one per cent of loans delinquent by 90 days or more, says a report released Monday.

The Equifax Canada Q4 2013 report says the consumer debt load nationally has reached $1.422 trillion but the national delinquency rate reached a record low at 1.12 per cent.

Among major cities, the average debt load in Edmonton recorded the biggest year-overyear hike at 5.3 per cent while in Calgary it was 1.9 per cent, the report says.

“The growing debt is an important indicator of the state of consumer financial health, and should not be dismissed,” said Regina Malina, director of modelling and analytics of Equifax Canada.

“But for the most part, consumers and lenders continue to be responsible in how they’re using credit. In short, monthly payments are being made.”

Total consumer debt in Canada increased by 4.5 per cent from $1.36 trillion as of the third quarter of 2013.

Ben Brunnen, an economic consultant in Calgary, said the key is to ensure debt levels are sustainable and undertaken for the right reasons.

“In the Prairie Provinces, where economic growth has been the strongest, delinquency rates are among the lowest in Canada,” said Brunnen. “Higher debt levels in this region could be a sign of confidence in the economy, which also helps stimulate growth.

“In Ontario and Eastern Canada, which have the highest delinquency rates, increased debt levels appear to be a sign of less prosperous economies. In fact, Toronto delinquency rates were 50 per cent higher than in Edmonton or Calgary.”

He said Calgary’s low debt growth in combination with its low delinquency rate put it in the most favourable position in Canada.