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Bank of Nova Scotia, the biggest Canadian lender to oil and gas companies, has been reducing risk in its portfolio and doesn’t expect a major fall out from slumping prices. “We feel very proud of the names that we bank,” Dieter Jentsch, the executive who’s overseen much of the lending to Western Canada’s energy firms in the past three years, said Tuesday on a conference call with analysts. “I’m confident this will withstand a period of unsettlement in the commodities market.” Bank of Nova Scotia doesn’t expect a major fall out from slumping prices after reducing risk in its portfolio. Scotiabank’s energy loans accounted for $14.8 billion, or 2.6 per cent of its loan book in the fourth quarter, according to financial disclosures. Of that, $3.4 billion was tied to Canadian exploration and production, including $1.2 billion directly linked to Western Canada Select oil. Bank of Nova Scotia and Bank of Montreal have the highest direct exposure to oil and gas among Canadian lenders, according to a report last week by RBC Capital Markets. Heavy Canadian crude has been declining since mid-May, with prices plummeting by more than 60 per cent amid a lack of pipelines and glut of […]
