The Way of the North - In Brief
- Canadian banks have been lauded for their soundness during the financial crisis. No big bailout of financial institutions was necessary in Canada, as it was in the United States and other countries.
- Canada’s centralized banking system emphasizes safety and stability; tight regulation of a small number of banks has prevented bank failures, but may have dampened competition.
- Characteristics that helped Canadian banks weather the recent storm, such as federal control and high capital requirements, were part of the system from the beginning. U.S. banking may be able to learn from the Canadian experience without jeopardizing competitiveness and innovation.
