The Fed Gov't and Banks.

[Riverwind]

Foreign banks would indeed go after the profitable sector as they have done in Britain. But then it forced *all* the banks in the nation to reduce their bank fees. This did not make them unprofitable if that is what you are suggesting it would do for Canada.

You think the British banking system is better than Canada? I have family who lived in Britain for last 10 years and they have endless stories about how the British banking system screws the average person even if they get a discount on some fees. They take the Canadian system any time.

[jdobbin]

You think the British banking system is better than Canada? I have family who lived in Britain for last 10 years and they have endless stories about how the British banking system screws the average person even if they get a discount on some fees. They take the Canadian system any time.

I certainly can't base anything on anecdotal information. Canada has the highest bank fees of the industrial countries. In your mind, does that make it the best system?

[Riverwind]

I certainly can't base anything on anecdotal information. Canada has the highest bank fees of the industrial countries. In your mind, does that make it the best system?

Fees are only part of the equation. People in Britain pay much more for mortgages and other bank services.

Do yout have any evidence that other countries with more competition have lower cost banking services or are you simply blindly assuming that it must be the case?

[Riverwind]

If everybody is illiterate or lazy or stupid or any combination of the three, I fail to see how we should have a government regulate a finance industry.

You fail to see why the government should exist at all. Is there any point trying to explain why the government should regulate some things but not others?

[jdobbin]

Fees are only part of the equation. People in Britain pay much more for mortgages and other bank services.

So you believe that ATM fees help keep down mortgage fees and other bank services? What evidence of that is there?

[Riverwind]

So you believe that ATM fees help keep down mortgage fees and other bank services? What evidence of that is there?

What I am saying is people pay banks for many different services. It is silly to pass judgement on Canadian banks based on the cost of ATM charges without looking at the complete set of bank services.

[jdobbin]

What I am saying is people pay banks for many different services. It is silly to pass judgement on Canadian banks based on the cost of ATM charges without looking at the complete set of bank services.

I think that is why I said regardless of what happens there needs to be a comprehensive study on banking and finance in Canada. It is undeniable that Canadians banks are protected at home in Canada and take their risks outside of Canada (where they have lost a lot of money over the years). They subsidize Canadians losses with large profits in Canada.

At the same time Canadian banks say they need to merge to be more competitive. I don't think we can proceed without some sort of study on what is best for Canada.

I have no idea if bank fees need to be removed but the banks certainly need to be looked at for what they are offering to Canadians and whether they should be protected within Canada.

[Riverwind]

It is undeniable that Canadians banks are protected at home in Canada and take their risks outside of Canada (where they have lost a lot of money over the years). They subsidize Canadians losses with large profits in Canada.

I was looking through the financial reports for the big US banks and comparing them to Canadian banks and I can find zero evidence to back up your assertation that Canadian Banks are hugely profitable.

[jdobbin]

I was looking through the financial reports for the big US banks and comparing them to Canadian banks and I can find zero evidence to back up your assertation that Canadian Banks are hugely profitable.

Zero evidence?

http://www.fin.gc.ca/toce/2001/bank_e.html

positioning Canada’s banks among the more profitable banks among major industrialized countries.

[Riverwind]

positioning Canada’s banks among the more profitable banks among major industrialized countries.

That does not prove your point at all. The term 'among the more profitable' does not mean the 'most profitable' nor does it mean they are 'hugely profitable' when compared to their peers. Futhermore, a bug chunk of those profits are paid in taxes to the Canadian government.

I think you are dreaming if you think that foreign competition or bank mergers will change anything. Eviscerating our domestic bank sector would hurt the economy in the long run and provide few benefits to consumers.

[geoffrey]

Allowing the banks to merge though RW would be HUGE for them internationally. BNS and RBC both have massive international presences, the majority of both their business is international. A merger between some of the banks would allow them to fight it out better with the likes of Deutsche Bank, Goldman Saches and Credite Suisse.

But to allow mergers in Canada would require the additional competition from abroad.

Look at it this way. Canada is a small country with a mediorce to fair investment climate. The major banks can make way more money for Canadian shareholders if given the ability to thrive in the much bigger markets of Europe and the United States (not to mention growing areas of finance like China and India).

Mergers need to happen, as does opening our markets to foreign competition.

[jdobbin]

That does not prove your point at all. The term 'among the more profitable' does not mean the 'most profitable' nor does it mean they are 'hugely profitable' when compared to their peers. Futhermore, a bug chunk of those profits are paid in taxes to the Canadian government.

I think you are dreaming if you think that foreign competition or bank mergers will change anything. Eviscerating our domestic bank sector would hurt the economy in the long run.

Please show me stats that say Canadian banks are not extremely profitable after taxes.

Scotiabank just released their quarterlies and the return on investment was equal to U.S. banks. Just finished watching CTV money report and they listed the six big banks as some of the most profitable after taxes in the world. You have evidence they aren't?

http://ca.today.reuters.com/news/newsArtic...RESULTS-COL.XML

http://www.canada.com/nationalpost/financi...76-192459ba6622

The big six earned $12 billion after taxes last year, one of the most profitable industries in Canada and one of the best performing banking systems in terms of profit in the world.

[Riverwind]

Scotiabank just released their quarterlies and the return on investment was equal to U.S. banks.

That is my point - their return on investment and profit margins are comparable to their peers in the US. People get so uptight because we don't have that many big companies in Canada so they get the wrong idea about how profitable the banks really are. You do not judge a company's profitability based on the total dollar figure.

[geoffrey]

In absolute terms, our big six combined doesn't even come near most major foreign banks.

ROI is a nice ratio to look at, but it doesn't address scale. I can sell lemonaide for a higher ROI than any major bank in the world makes.

[jdobbin]

]That is my point - their return on investment and profit margins are comparable to their peers in the US. People get so uptight because we don't have that many big companies in Canada so they get the wrong idea about how profitable the banks really are.

I thought your point was that Canadian banks were not hugely profitable. The U.S. top banks are listed as some of the top in profitable. Citibank and Bank of America are right up there along with most of the top Canadian banks.

[jdobbin]

In absolute terms, our big six combined doesn't even come near most major foreign banks.

ROI is a nice ratio to look at, but it doesn't address scale. I can sell lemonaide for a higher ROI than any major bank in the world makes.

Scale doesn't address profit. Some small Swiss banks are so profitable and have only one branch.

[geoffrey]

In absolute terms, our big six combined doesn't even come near most major foreign banks.

ROI is a nice ratio to look at, but it doesn't address scale. I can sell lemonaide for a higher ROI than any major bank in the world makes.

Scale doesn't address profit. Some small Swiss banks are so profitable and have only one branch.

So your saying that banks make too high of a ROI? Tell that to their investors. If they can move their money to Citibank, why wouldn't they if RBC was paying out much less?

[jdobbin]

So your saying that banks make too high of a ROI? Tell that to their investors. If they can move their money to Citibank, why wouldn't they if RBC was paying out much less?

I haven't argued that. My argument has been that Canada's banks are extremely profitable and have an excellent return on investment.

[Riverwind]

I thought your point was that Canadian banks were not hugely profitable. The U.S. top banks are listed as some of the top in profitable. Citibank and Bank of America are right up there along with most of the top Canadian banks.

So? If other large banks have comparable profits in other markets then you can't claim that the banks are 'hugely profitable'.

[jdobbin]

So? If other large banks have comparable profits in other markets then you can't claim that the banks are 'hugely profitable'.

Canada's own banks have claimed they are hugely profitable in shareholders meetings. I shouldn't be telling you anything new here. Compared to other industries, compared to other countries, it is a highly profitable and successful industry.

It is also one that is highly protected and sets fees for ATMs that are generally high compared to the rest of the industrialized world. You have stated that it is needed to maintain the system but evidence in other countries once the system has been paid for, it becomes a profit center anyways because it requires fewer employees to service ATMs.

I think banking and finance in Canada should be reviewed thoroughly on questions of mergers, fees, regulation and the like. You are satisfied with the status quo? Does that mean you oppose mergers?

[sideshow]

Well.......

Most banks nowadays set a limit to the amount of over the counter transactions an account holder can have each month-unless they pay a fee for unlimited access. So some people are REQUIRED to pay the ATM fee-or pay at the counter. So in this regard I see it as an unfair practice by the banks.

On the other hand, like others have said, if you plan properly, I don't see why you need to have so many transactions. I mean, I barely EVER use an ATM. Internet banking, interac at the till, whatever, seems to be so easy, so convenient, and so prevalent that you shouldn't need to be making constant trips to the ATM.

And even if you do once in a blue moon get stuck, whats a buck or two for the convenience? So in this regard, why shouldn't the various banks be able to charge a fee for a convenient service?

I guess I really don't agree or disagree with the whole concept of regulation. I could care less.

[Riverwind]

It is also one that is highly protected and sets fees for ATMs that are generally high compared to the rest of the industrialized world.

I believe that statement is wrong because every ATM I have seen outside Canada charges more than what Canadian banks charge.

I think banking and finance in Canada should be reviewed thoroughly on questions of mergers, fees, regulation and the like. You are satisfied with the status quo? Does that mean you oppose mergers?

Yes, I am satified with the status quo. We have a healthy banking system which is good for the country. We have good competition that includes foreign banks like ING and HSBC. Other foreign banks could enter the market if they wanted to. We also have the credit unions. I also believe that the claim that other countries pay less for bank services is false. I am speaking as someone who travels a lot and has had to deal with banks in other countries.

Furthermore, I think that allowing mergers and direct competition from foreign banks would reduce the amoung of competition in the Canadian marketplace because foreign banks are not going to build a retail presense from scratch - they will simply buy out existing banks or credit unions which means the number of players would likely go down. Fewer players means higher fees for Canadians.

[Charles Anthony]

Yes, I am satified with the status quo. We have a healthy banking system which is good for the country. We have good competition that includes foreign banks like ING and HSBC. Other foreign banks could enter the market if they wanted to.

Can you prove that all of this can NOT be better with less bank regulation? or at least with a change in regulation?

I think you are dreaming if you think that foreign competition or bank mergers will change anything.

Should foreign banks be outlawed or restricted from operating in Canada?

Eviscerating our domestic bank sector would hurt the economy in the long run and provide few benefits to consumers.

Prove it.

If everybody is illiterate or lazy or stupid or any combination of the three, I fail to see how we should have a government regulate a finance industry.

You fail to see why the government should exist at all. Is there any point trying to explain why the government should regulate some things but not others?

I am not asking you a personal question. You fail to justify your argument.

My personal beliefs and your personal beliefs on "government" have no bearing on the validity of your argument. If I changed my username and re-asked my question under a pseudonym, would you answer my question?

There is a point to explain why the government should regulate some things but not others. The point is that your demands and impositions affect people other than yourself. An other point is that your demands and impositions on bank regulation is not universally accepted and you speak as if it is as glorious as the sunlight we enjoy every day.

[jdobbin]

I believe that statement is wrong because every ATM I have seen outside Canada charges more than what Canadian banks charge.

Yes, I am satified with the status quo. We have a healthy banking system which is good for the country. We have good competition that includes foreign banks like ING and HSBC. Other foreign banks could enter the market if they wanted to. We also have the credit unions. I also believe that the claim that other countries pay less for bank services is false. I am speaking as someone who travels a lot and has had to deal with banks in other countries.

Furthermore, I think that allowing mergers and direct competition from foreign banks would reduce the amoung of competition in the Canadian marketplace because foreign banks are not going to build a retail presense from scratch - they will simply buy out existing banks or credit unions which means the number of players would likely go down. Fewer players means higher fees for Canadians.

I think the best way to prove your thoughts on whether ATMs in Canada are cheaper than elsewhere in the world is to do a complete review of the banking system in Canada.

A status quo attitude doesn't serve the banks or the Canadian public very well.

Foreign banks find it very difficult to enter the Canadian system in any capacity whether it is as a brokerage or investment bank let alone a retail bank. The bank charter protects against that.

The whole thing needs a careful look.

[Riverwind]

There is a point to explain why the government should regulate some things but not others. The point is that your demands and impositions affect people other than yourself. An other point is that your demands and impositions on bank regulation is not universally accepted and you speak as if it is as glorious as the sunlight we enjoy every day.

I have given you an explaination. Government should regulate matters if an imbalance in the marketplace gives the seller an unfair advantage over the buyer. I do recognize that the term 'unfair advantage' is a subjective term and open to discussion. However, the basic criteria I use comes down to choice: i.e. can the buyer reasonably refuse to purchase the service or can the buyer find another seller. When it comes to ATM fees I think that consumers have choices available so the government does not need to be involved.

That said, such an arguement means nothing to someone who has already decided that there is no such thing as an unfair advantage in a free market. It is like trying to explain the finer points of evolution to someone who beleives that the world was created by a diety 6000 years ago.