Trader’s Narrative

According to a recently released Global Competitiveness report from the World Economic Forum, Canada has the “soundest” banking system in the world.

With runners up being:

Sweden, Luxembourg, Australia, Denmark, Netherlands

And coming in third:

Belgium, New Zealand, Ireland, Malta

The United States? Ranked 40th. Zimbabwe? 122nd.

The methodology for the results isn’t all that clear but it was based on the opinion of 12,000 executives which ranked banks based on a scale of 1 (insolvent) to 7 (healthy).

So then, why are the Canadian banks getting spanked in the stock market? Here’s a chart of the weakest Canadian bank, CIBC, having fallen about 53% from the when the market topped in October 2007:

In comparison, Bank of America (BAC) has fallen 59% in the same time span and Citigroup (C) 68%. Case of the baby getting thrown out with the bathwater?