New Index Tracks the Financial Resilience of Canadians and Shows BMO Leads in Supporting Customers Through COVID-19

NORTH VANCOUVER, BC, Dec. 3, 2020 /CNW/ - Seymour Management Consulting Inc., a Canadian financial consulting firm and leading independent authority on financial health launched its new Index in May based on February data and released its October 2020 Seymour Financial Resilience Index TM report last week.

With banks releasing their Q4 financial results and re-stating their commitments to supporting their customers, employees and communities facing financial hardship through the pandemic. Of the big five banks, CIBC and BMO had the greatest increases in their customers' mean financial resilience scores at the national level between February and October 2020. The October Index however shows that only 28% of households at the national level are 'Financially Resilient', while over 18 million households are represented in the other three resilience segments: 'Extremely Vulnerable', 'Financially Vulnerable' and 'Approaching Resilience'.

Seymour Consulting's Financial Health Index [FHI] studies also include independent tracking on the extent to which survey respondents report that their primary FI has helped improve their financial wellness [1]. Here BMO is currently leading the pack, with 41% of BMO customers rating BMO a 7 to 10 out of 10 for helping to improve their financial wellness as of October, compared to 37% for CIBC, 36% for TD, 35% for RBC and 34% of customers for Scotiabank.

A first in the world, the Seymour Financial Resilience Index TM Index measures a household's ability to get through financial hardship, stressors and shocks as a result of unplanned life events based on nine behavioural, sentiment and resilience indicators. The Index measures and tracks the financial resilience of Canadians at the national, provincial and individual household level, providing a new lens on which customers, households and communities need more targeted support from Financial Institutions and policymakers.

The Index was developed over four years. "We created the Index because we wanted to bring to light the behaviours, sentiments and factors affecting Canadians' financial resilience," says Eloise Duncan, CEO and Founder of Seymour Management Consulting Inc. ['Seymour Consulting.']  "Using the iceberg analogy, financial resilience is what is under the water and not generally visible. It can be large (Financially Resilient) or small (Extremely Vulnerable). The index and financial resilience score shines a light under the water to see just how resilient we are. "We also wanted to help build accountability within the financial industry for banks, credit unions and others to help improve the financial well-being of their customers throughout their lives. With the COVID-19 pandemic and increased financial hardship and vulnerability a persistent issue, this is more important than ever."

The October index release shows financial vulnerability as a mainstream issue and increasing for households impacted by job losses and/or reduced hours. And while 54% of 'Financially Resilient' households rate their primary Financial Institution highly for helping to improve their financial wellness as of October, this is only the case for 26.9% of Extremely Vulnerable and 29% of Financially Vulnerable customers (representing 41% of the population). So while the banks are doing a good job in supporting customers at the national level, there are opportunities for strengthened and more targeted support - including as the pandemic impacts unfold.

Some of the key insights from the October 2020 Seymour Financial Resilience Index TM include:

• The mean national financial resilience score for Canada is 54.53 in October, up from 49.58 based on the February baseline. Overall, Canadians are 'Approaching Resilience.'
  
  
• 77% of households report having excellent, very good or good credit scores in October, yet of these only 35.7% are 'Financially Resilient'.
  
  
• Government COVID-19 relief is helping many Canadians bridge through financially, but there has been an increase in 'Extremely Vulnerable' households by 700,000 households and in 'Financially Vulnerable' populations by 340,000 households between June and October - with these two segments combined representing 10.64 million adults. The federal government's announcement on Monday of continued financial relief for Canadians through the pandemic is clearly needed, but support could be more targeted to those who need it most.
  
  
• There are many changing consumer and financial behaviours of Canadians overall and the four financial resilience segments.
  
  
• 53% of Canadians report that they now have new and/or higher expectations around how their Financial Institution could 'have their back' as a result of the pandemic, and 86% agree that their household is now more aware of the importance of establishing or improving their financial resilience.

The next Index release will be based on February 2021 data, with more information and the October Index report available at http://financialhealthindex.org 

[1] Seymour's Financial Health Index [FHI] 2020 studies are based on online surveys with 4989 adults (for June) 3016 adults (for October) and 1013 Canadians for February 2020, with data representative of the Canadian population by age, gender, province and household income. Survey respondents recruited through the Angus Reid Forum with all analysis conducted by Seymour Consulting. The first FHI study was launched in 2017 with 5000 Canadians and the Seymour Financial Resilience Index TM created based on four years' of longitudinal national financial health data.

About Seymour Management Consulting Inc.

Seymour Management Consulting Inc. is a Canadian financial services consulting firm founded in 2009 and member of the C.D. Howe Institute. Our core purpose is to help measurably improve Canadians' financial resilience and well-being, by collaborating with Financial Institutions, Government and committed institutions to better support the financial resilience of their customers, employees and target populations at scale. Through our team of experts and by applying the Seymour Financial Resilience Index TM, we lead measurement, research and analytics, strategic consulting and collaborative innovation.

SOURCE Seymour Management Consulting Inc.

For more information or to arrange an interview contact: Cynnamon Schreinert, 604-802-2733, [email protected]