The History Of Top Banks In Canada And What They Offer

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canada's 5 banks

Canadian banks consistently rank among the best in the world when it comes to security, placing first in 2016 and third in 2017.

The top banks in Canada have a proud history of reliability, with no bank failures during the Great Depression compared to over 9000 in the United States. Canada also avoided a banking crisis during the worldwide financial meltdown in 2008.

Canadians enjoy access to the highest number of ATMs per capita in the world, with 223 ATMs for every 100,000 adults. They also benefit from one of the highest penetration levels of electronic channels such as debit cards, Internet banking, and telephone banking.

There are approximately 6000 bank branches in Canada, with the majority of them owned by “The Big 5”. Here we take a look back into the history of these five financial giants and how they came to be, as well as what financial services they surrently offer.

Royal Bank of Canada

The Royal Bank of Canada or more popularly recognized as RBC is Canada’s largest bank, and is the eleventh biggest bank in the world by market capitalization, as of May 2018. It was founded in 1864 in Halifax, Nova Scotia as the Merchant’s Bank of Halifax.

It operated as a commercial bank that financed the fishing and timber industries, as well as the European and Caribbean import/export businesses.
In the late 1800s the bank expanded into other Maritime Provinces.

As the bank grew, executives decided to change its name to reflect its growth and western expansion.

In 1901 the Merchants Bank of Halifax became the Royal Bank of Canada.

By then the centre of the Canadian financial industry had moved from Halifax to Montréal.

RBC relocated its head office there in 1910 – its corporate headquarters have been located in Toronto – Canada’s biggest city – since 1976.

As one of the top banks in Canada, RBC serves over 16 million clients worldwide and has operations in over 40 countries, including a strong market in the Caribbean.

It provides personal and commercial banking, wealth management, insurance, investor services and capital market products and services.

Toronto-Dominion Bank

Toronto-Dominion Bank (Commonly referred to as TD) is not only one of the top banks in Canada, but also in the world. It is Canada’s second largest, and the twelfth biggest bank in the world by market capitalization, as of May 2018.

Toronto-Dominion was created in 1955 through the merger of the Bank of Toronto and The Dominion Bank, which were founded in 1855 and 1869 respectively.

In 1954, negotiations began between the two banks and by the end of the year, an amalgamation agreement was reached.

In their brief to the Minister of Finance, the banks stated: “It is more burdensome for a small bank to keep pace with the development of our country than for a large bank, with the result that the effective growth and comparative influence of smaller banks will probably in the future decline in comparison with that of the larger banks.”
On November 1, 1954, Canada’s minister of finance announced that the amalgamation was accepted.

On February 1, 1955, the Bank of Toronto and The Dominion Bank officially became the TD Bank.

The bank and its subsidiaries now have over 22 million clients worldwide.
In Canada, the bank operates as TD Canada Trust (Canada Trust was acquired in 2000) which serves more than 11 million customers at over 1,150 branches.

In the United States, the company operates as TD Bank, and serves more than 6.5 million customers with a network of more than 1,300 branches in the eastern United States.

TD bank has a network of mobile mortgage specialists, financial planners, private bankers, investment advisors, and portfolio managers.

The Bank of Nova Scotia

The Bank of Nova Scotia, operating as Scotiabank, is Canada’s third-largest bank.
Scotiabank was founded in Halifax, Nova Scotia back in 1832, intending to facilitate the transAtlantic trade of the time.

As the bank continued to grow, its expansion was limited to the Maritimes until 1882, when the bank moved west by opening a branch in Winnipeg, Manitoba.

The bank continued its expansion by opening branches in the United States.

This included opening a branch in Minneapolis in 1885, which later transferred to Chicago in 1892 and a Boston branch in 1899.

Scotiabank made history when it opened a branch in Kingston, Jamaica in 1889 to facilitate the trading of sugar, rum, and fish.

Not only was it Scotiabank’s first move into the Caribbean, it was the first branch of a Canadian bank to open outside of the United States or the United Kingdom.By the end of the 19th century, the bank was represented in all of the Maritimes, Quebec, Ontario, and Manitoba.

In 1900, the bank moved its headquarters to Toronto, where it has been located ever since.

As one of the top banks in Canada, Scotiabank serves more than 24 million customers in over 50 countries.
It offers a range of products and services including wealth management, corporate and investment banking.

The Bank of Montreal

The Bank of Montreal (BMO) is Canada’s fourth-largest bank.

Originally named Montréal Bank, it was founded by a group of nine of the city’s most prominent figures, and officially began conducting business on November 3, 1817 – making it Canada’s oldest bank.

Its purposes were to provide a form of paper money for its customers, a place where they could save money securely, a source of loans to borrow money, and a foreign exchange.

In 1818, the bank began operating outside of Montréal through associations with other banks in London, New York and Boston.At the same time, it opened offices in Québec City and Kingston based on demand for its services.

In 1822, the bank became known as the Bank of Montréal when it made the switch from a private company to a public company.In 1842, it obtained its first Toronto branch (then the town of York).

Then in 1867, the year of Confederation, the bank expanded to the Maritime provinces for the first time, opening branches in New Brunswick and Nova Scotia.

BMO’s operational head office moved to Toronto in 1977, while its legal headquarters remains at the historic Montréal structure it has occupied since 1847.

The company has more than 900 Canadian branches, as well as substantial operations in the Chicago area and elsewhere in the United States where it operates as BMO Harris Bank.

Another one of the top banks in Canada, BMO provides serves more than 12 million customers.It offers options in retail banking, wealth management, and investment banking products and services.

The Canadian Imperial Bank of Commerce

Another one of the top banks in Canada is The Canadian Imperial Bank of Commerce.It is Canada’s fifth largest bank.

CIBC was formed in 1961 through the merger of the Canadian Bank of Commerce (opened 1867) and the Imperial Bank of Canada (opened 1875).

In 1960, Imperial Bank chairman Mackersy approached Bank of Commerce president McKinnon, with a proposal to merge the two banks.

This proposal came off the back of a decade of expansion in the Canadian economy and Canada’s capitalization of the industrialization of its natural resources.They quickly reached a deal between the two banks on June 1, 1961.

The two banks merged to form the Canadian Imperial Bank of Commerce.

The new bank had over 1,200 branches across Canada and possessed the greatest resources and the most branches of any bank in the country.

Computerization began to completely change the banking in the 60s.CIBC was the first bank in Toronto to follow up and adopt it.This also marked the introduction of inter-branch banking.

Before the decade was out, CIBC had introduced the first 24-hour cash dispenser, which would eventually become the ATM.

CIBC’s current headquarters at Commerce Court in Toronto was completed in 1973, and at the time the 57-storey building was the tallest in Canada, and the largest stainless-steel-clad building in the world.

The bank has international operations in the United States, the Caribbean, Asia and Europe and serves more than eleven million clients worldwide.

Other than personal banking, CIBC offers Retail and Business Banking, Wealth Management and Capital Markets.

Final Remarks:

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