Canadian bank system gets the balance right
THE US may have aspired to be a city on a hill, but its neighbour Canada has attracted more attention recently as a paradigm for creating and regulating a banking system that has been stable, and even profitable, through the worst economic crisis since the Great Depression.
Praise has come from many quarters, including Taoiseach Brian Cowen who has promised to create a new regulator that will "build on best international practice, similar to the Canadian model".
Canada`s reputation for fiscal conservatism may have been boring during boom times, but being boring has left the country`s banking system in a rare position of strength in the financial world.
"It has turned out that boring is good and an excellent attribute of a financial system," Jim Flaherty, Canada`s minister for finance, told European reporters on a visit to Canada this week.
Gordon Nixon, chief executive of Canada`s biggest bank, Royal Bank of Canada (RBC), prefers being described as "conservative from a risk perspective", and says the bank will stick to that model.
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