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Canada’s economy, once the envy of developed countries following the global recession, is struggling to gain momentum as households deal with record debts. Low interest rates pushed the nation’s ratio of debt to disposable income to a record 163.7% in the third quarter, according to Statistics Canada, surpassing levels in the U.S.

“We’ve learned around the world that when you make the consumer indebted like that, their ability to withstand shocks is dramatically less,” Clark said. “So the economy as a whole is more accident prone, more fragile.”

The economy as a whole is more accident prone, more fragile

Clark, who has run Toronto-Dominion since December 2002, said the situation undermines Canada’s competitiveness, and the country may not be able to “ride up the U.S. growth” as much as in previous times.

“Over time, the consumer becomes more fragile and the Canadian economy becomes less competitive,” he said. “That’s worth worrying about.”

Clark, who led the Toronto-based bank in a $25 billion U.S. expansion, will retire in November after a dozen years in the post. He’ll be succeeded by Bharat Masrani, 57, the chief operating officer. Clark, a self-described “old-fashioned banker,” said he’s not going to spend the next few months trying to land another big transaction before departing.

“My job is to make sure there’s a smooth transition,” he said. “What you’re going to get is continuity, but with a new management team — and in the sense the same management team, but refreshed and elevated.”