Canada’s Banks

Banking in Canada is done through the branch system; that is, there are no private, independent banks and instead there are a series of large, national banks that operate branches from coast to coast.
These banks are giants in the banking world, and The Big Five (the five biggest banks in Canada) operate not only within Canada but internationally, as well, with branches throughout the US, the EU, parts of Asia and the Middle East.
Canada’s banks came into the international spotlight in 2008-2009 with the way they had prepared for the global economic recession. Long before the banking and housing crash of 2008, which heavily impacted US and European banks, Canada’s banks, in conjunction with the federal government, had forecast trouble in the future and had taken steps to insulate themselves. 0% down payments were abolished, interest rates were carefully monitored, inflation was expertly used as a tool and investments were chosen with an eye on the future.
All this meant that when the bubble burst in 2008, Canada’s banks (and the economy) were able to weather the storm and showed increasing growth in 2008, 2009 and 2010.
Below is a list of Canada’s domestic banks. There are a few big international banks in Canada as well, including Citibank, ING, HSBC and Bank of America, but they only enjoy a small market share while most people, businesses and governments continue to put their trust in the Big Five Canadian financial institutions.
The Bank of Canada

The Bank of Canada is Canada’s central bank. It prints the country’s currency, sets prime interest rates, regulates the banking industry, insures deposits and carries the federal governments accounts. The BOC’s mission statement is “to promote the economic and financial welfare of Canada”. The BOC also gives business loans to both big corporations and entrepreneurial start-ups.

The Bank of Canada was founded in 1935 as a reaction to the Great Depression that had swept the world in 1929. Canada was hit particularly hard and by 1935, with over 20% unemployment (while other nations were getting their economies back in order), Parliament decided to establish a central bank. Before then the larger institutions were printing their own money (Bank of Montreal dollars are collector items worth over $100,000!) and most people used British Pounds or American Dollars.
One of the first jobs of the Bank of Canada was to nationalize a printed currency, and by 1938 this had largely been accomplished (the BOC adapted the Canadian Dollar).
As one of the key players in Canada’s financial economy, indeed it is the manager of all the other banks, the Bank of Canada counts as a great Canadian financial institution.
The Bank of Montreal

The Bank of Montreal, or BMO, is the oldest bank in Canada and is also one of the biggest. It is a member of the Big Five and is involved in everything from consumer deposit accounts to tax-free savings accounts to investment portfolio management to loans and mortgages to credit cards to international investments.

Internationally the Bank of Montreal operates as BMO Harris Bank, particularly in the United States, and in Europe they operate BMO Capital Markets and BMO Nesbitt Burns.
BMO was founded in 1817 in Montreal, making it the oldest bank in Canada (its institution number is 001) and the third oldest bank in North America. By 1920 BMO was operating from coast to coast and in Chicago, New York, Washington DC and London.
Over seven million Canadians bank with BMO at over 900 branches across the country, making it the fourth largest bank by deposit volume in Canada.
Canadian Imperial Bank of Commerce (CIBC)

The fifth largest bank in Canada by deposits, CIBC is headquartered in Toronto. It is listed number 17 on Forbe’s biggest banks list and operates numerous international financial institutions. Globally, the Canadian Imperial Bank of Commerce serves over 11 million customers and acts as the contracted central bank for several smaller nations (mostly in Africa).
CIBC was founded in Toronto in 1867, and with the onset of the Yukon Gold Rush the Canadian government asked the bank to expand operations to Dawson City. By 1900 the bank was experiencing a boom that saw it expand from coast to coast and into US and European markets. In 1936 CIBC became the first bank in Canada to offer personal loan products and this line of business remains one of their strongest to this day.
In 2003 the United States’ Securities and Exchange Commission fined CIBC $80 million US for its role in the Enron scandal, where the bank had helped to manipulate financial statements, and again it ran afoul of US authorities in 2005 for its role in the Mutual Fund scandal. In 2007 the bank ran into trouble with Canada’s privacy commissioner for selling confidential customer information to marketing firms, and again that year the bank was fined for mismanagement of client overdraft and credit accounts.
Laurentian Bank

Laurentian Bank operates almost solely in Quebec, with one branch in Ottawa, Ontario. It is not one of the Big Five but enjoys success as a well-managed bank with a good reputation. Laurentian operates 32 branches and 15 brokerage offices across Quebec.

Originally founded as Banque D’Epargne de la Citee et du District in 1846, it was created as a place to provide the working class with a means for saving. At the end of its first fiscal year it held over 500 accounts. The bank began to branch out across Canada and in 1972 it became the first bank in the world to link all its accounts to a central computer. In 1987 the bank was renamed Laurentian Bank. In 2003 Laurentian sold all its holdings outside of Quebec to TD Financial Group and Canadian Western Bank.
National Bank of Canada

National Bank is the sixth largest bank in Canada. Headquartered in Montreal, the bank operates 446 branches across the country and serves over 2 million clients. The bank also has branches in Hong Kong, Havannah, London, Paris, Nassau and New York City, as well as two banks in Florida operating under the name Natbank.

The majority of the bank’s branches are in Quebec, and most of its clients are French speaking.
PC Financial

President’s Choice Financial (or PC Financial) is a strange offshoot of a joint-venture between CIBC and Loblaw’s Group, a Canadian supermarket chain. For years President’s Choice has been a household name in non-brand food and household goods, but in 1998 began to operate consumer banking services.
PC Financial does not have traditional brick-and-mortar branches, instead it is exclusively online and telephone banking. While all the accounts are actually held in CIBC, their services are marketed under the PC Financial brand. They are also unique for being Canada’s first no-service fee bank. They do not offer business or investment services, although they do run a line of credit cards through MasterCard and Visa.
Royal Bank of Canada (RBC)
The Royal Bank of Canada is the largest bank in the country, with over 17 million clients, 1,209 branches and 80,000 employees. In the US it operates as RBC Bank and operates nearly 500 branches, and in the Caribean it operates under the brand RBC Capital Markets. RBC Dominion Services is the banks international investment firm, and the Royal Bank of Canada is listed in the top 50 banks by Forbe’s.
RBC offers every type of financial service imagineable, from chequing and savings accounts to merger and acquisition investments. Its customers range 10-year olds opening their first deposit account to the United Nations.
In 1864 RBC began as Merchant’s Bank in Halifax, Nova Scotia, and by 1880 had expanded across the Maritime provinces. In 1900 Merchant’s Bank merged with Trader’s Bank (a Toronto-based firm) and relocated headquarters to Toronto in order to be closer to the growing western market and became known as Royal Bank of Canada. In 1902 RBC opened a branch in Havannah and in San Juan, and in 1910 their first London office opened. By 2000 RBC had operations in nearly every country on the globe, with most of them in North America and Europe. RBC was the second western bank to open in Moscow in 1992.
In 2010 RBC won a “Best International Bank” award and was listed as one of the 10 most powerful banks in the world by Forbe’s.
Scotiabank (officialy the Bank of Nova Scotia) is the third largest bank in Canada with over 12 million clients and 500 billion dollars in assets. Scotiabank brands itself as “Canada’s international bank” with 2000 branch operations on every continent. In 2009 Scotiabank won a UN award for its role in offering no-interest loans for development projects in third-world countries, one of the only banks in the world to do so.
Scotiabank opened its doors in 1832 in Halifax, Nova Scotia and immediately positioned itself as the Maritime’s bank of choice. Shortly after it was operating in Montreal and Toronto, and following the American Civil War became the first Canadian bank to open a branch in the US, in Minneapolis. By the end of the Second World War Scotiabank was operating over 500 branches in all ten provinces and twelve states, and was one of the first banks on the allied side to open operations in war-ravaged Berlin.
Scotiabank remains one of the top banking institutions in Canada and has positioned itself as a responsible bank for a new millenium. It showed continued growth during the financial recession of 2008 and has no plans for slowing down.
TD Canada Trust
TD Canada Trust came about as a result of a merger between Toronto Dominion Bank and Canada Trust. Both banks had very large client bases and the decision to keep both names in the new bank was kept in order to retain brand loyalty. TD Canada Trust operates over 1100 branches and serves more than 10 million customers.
TD Canada Trust also operates a series of international investment houses, namely under the TD Waterhouse brand, and has earned international recognition for fair and ethical business practises. Tim Hockey is the banks CEO and President, and prides himself on ethical banking practises. This has shown in the bank’s success as it has grown by 240% in 11 years.
In 2006, 2007, 2009 and 2010 TD Canada Trust won JD Power’s “Customer Satisfaction Award” as the best bank for consumers in Canada, and the bank operates the longest hours of any of the banks in Canada, usually closing at 8 pm and open on Saturdays.

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