What is BMO's current exposure to impaired trucking loans?

BMO's gross impaired loans in transportation reached a record CA$585 million in the latest quarter.

Why are trucking companies struggling to repay loans?

A persistent freight recession over the past three years has made it difficult for trucking companies to repay loans, especially those taken out when rates were high.

When does BMO expect economic conditions to improve for the transport sector?

BMO anticipates an improved economic backdrop in the U.S. going forward and expects stronger growth in Canada later next year.

Home / Business and Economy / Trucking Loans Hit Record High Amid Freight Downturn

Trucking Loans Hit Record High Amid Freight Downturn

6 Dec

•

Summary

BMO's gross impaired loans in transportation reached a new peak of CA$585 million.
The transportation sector saw a 38% increase in impaired loans last quarter.
A three-year freight recession challenges trucking companies' loan repayment abilities.

Trucking Loans Hit Record High Amid Freight Downturn

Gross impaired loans within BMO's transportation portfolio have reached a new peak, totaling CA$585 million for the most recent quarter. This figure represents a significant worsening of conditions, following a temporary relief in the prior quarter. The transportation sector, in particular, experienced a substantial 38% increase in these troubled loans.

This rise in impaired loans indicates growing difficulties for customers in repaying their debts, highlighting broader health concerns within the trucking industry. The prolonged freight recession, now in its third year, has created a challenging environment for trucking companies, many of whom acquired equipment when spot rates were exceptionally high.