[lbo-talk] The Canadian banking model

[Ian Rogers]

What's this with Canadian banks being the most stable in the world?  
That'll upset those Aussie bankers who endlessly contend they claim  
that crown.

Maybe also of interest is that the Australian banking industry is as  
concentrated, even a tad more concentrated, than in Canada.

I assume that in Canada, as in Australia, the pricing power of the  
cartel is now becoming pronounced. Over the last six months business  
borrowers and consumer borrowers have received rates cuts on average  
equal to only half of the 4 percentage point cut in the cash rate  
(which in Australia remains at 3.25 per cent, so high by world  
standards but regarded as loose by those making the policy).

May I point out a Boston Consulting Group study published this week  
which wraps up a lot of data on bank profits globally from 2008 in a  
pretty useful way.

http://www.bcg.com/impact_expertise/publications/publication_list.jsp?pubid=2841

or

http://tinyurl.com/cqj8wy

Ian


>
> On Feb 28, 2009, at 7:20 AM, Michael Pollak wrote:
>
>> [Can our Canadian friends elaborate on the idea that Canadian banks  
>> are "all broadly owned by public shareholders."  Is that in any way  
>> different from the normal meaning of being a publicly owned company  
>> -- i.e., being entirely owned privately?]
>>
>> [Rhetorically it's a nifty move to say that adopting the Canadian  
>> model would mean going back to Hamilton's original vision.]
>>
>> http://www.nytimes.com/2009/02/28/opinion/28tedesco.html
>
> This piece prompted a blog polemic:
>
> <http://doughenwood.wordpress.com/2009/02/28/the-virtues-of-concentration/ 
> >.
>
> Doug
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