TORONTO – Canada’s biggest banks say consumers are reaching the limit on how much they can afford to borrow, and that’s likely to slow loan growth this year.

Royal Bank (TSX:RY) chief executive Gord Nixon said Tuesday that he expects Canadian households will begin to show more restraint.

“In terms of pure consumer lending (growth), we’ll probably be operating at a much lower rate than we have been over the last few years,” he told a bank industry conference in Toronto.

“There’s no question that the consumer has been leveraged up,” he added.

Canadians have taken advantage of low interest rates for years, and the ability to carry high levels of debt has left many taking on more than they can handle.

Policymakers have expressed concern that a sudden rise in interest rates would leave many consumers unable to meet their payments.

Statistics Canada reported last month that household debt touched an all-time high during the third-quarter of 2013, inching up 0.6 percentage points to 163.7 per cent over the summer months.

The increase means Canadians owe nearly $1.64 for every $1 in disposable income they earn in a year.

Nixon said he expects lending growth to remain tight, rising to mid single-digit levels, for “an extended period of time.”

Scotiabank chief executive Brian Porter said the bank will focus more efforts on growing its wealth management business in the coming quarters, as more consumers look at how much they’re saving and investing.