RBC Royal Bank is feeling so confident about the Canadian economy that it thought it would hold a press conference to share its sunny outlook yesterday. According to Jim Westlake:

“If the U.S. economy settles down and they get the types of growth that are forecasted right now, and you don’t see any more secondary effect, we think it’s not going to have any huge consequences” [here.]

A triple conditional. How reassuring.

RBC’s not tightening its lending:

Mr. Westlake suggested RBC is not making any significant changes to its conditions for handing out loans to consumers and businesses.

OK, maybe they are tightening. But just a little. Barely counts!

And the mighty Royal is sailing majestically through the choppy seas of the credit crunch:

The margins that banks earn on products based on the prime interest rate are being squeezed somewhat, Mr. Westlake said, noting “it’s still a good market.”

OK, maybe not.

Canadian banks are paying higher interest on the money they borrow to lend out, but not yet passing on the increase to consumers — a nice situation for us, but not one that can last indefinitely. Squeezed margins lead, eventually, to lower bank profits — and with bank stocks held by every widow, orphan, and pension plan, that’s something that touches everyone somewhere along the line.