Thank you, André.
We are seeing several consistent trends.
First, many Canadian households remain under significant financial pressure due to increasing debt levels. With little savings and many living paycheque to paycheque, even a modest shock can quickly lead to a financial crisis.
Second, we are seeing longer-term and riskier debt products, especially in auto lending. The combination of higher vehicle prices, loan terms stretching over seven to eight years and consumers carrying negative equity is a problem for households.
Third, alternative and digital lending, including buy now pay later products, have expanded rapidly. Once used mainly for small purchases, these products now finance everything from travel to major household expenses. These lending products are easy to access, but they are expensive and difficult to exit.
Fourth, the costs of housing pressures are increasing. Rents are higher, and many preconstruction buyers are losing deposits and walking away from contracts as falling property values make financing harder to secure. Longer mortgage amortizations may delay distress, but they can also mask underlying affordability problems.
Finally, income volatility is becoming more common. Irregular earnings in gig work and self-employment can leave households struggling to match tax obligations and cash flow, often increasing reliance on credit.
We believe there are four areas where targeted action could improve the resilience of Canadian households. At this point, I'll turn it back to André to expand on these areas.