Canada’s big banks will likely increase their...

Canada’s big banks will likely increase their reserves against possible defaults on Third World loans again this year to bring the book value of that debt closer to market worth, analysts said. But special charges the banks will take to boost their reserves are not expected to be as large as ones they took in the third quarter of last year that left the institutions with net losses for the first time since World War II. The banks are expected to lift reserves to 40% to 50% of their exposure in Third World countries.