Controlling the market, and gouging out world-leading, record profits year after year for the past decade, while reducing service and treating many customers unfairly
According to Finance Canada, despite the lowering of barriers to competition 15 years ago under a World Trade Organization agreement, Canada’s Big 6 Banks:
- Bank of Montreal (BMO)
- Canadian Imperial Bank of Commerce (CIBC)
- National Bank
- Royal Bank of Canada (RBC)
- Bank of Nova Scotia (Scotiabank)
- Toronto Dominion Bank (TD)
control 93 per cent of all banking assets, and are more profitable than comparable banks in other countries, and than small banks in Canada, and Canada’s corporate sector overall. The big banks control of the market essentially allows them to gouge and abuse customers with excessive fees, high interest rates (especially on credit cards). As a result, government regulation is needed to stop them.
The federal government bailed out the banks with $114 billion in mortgage purchases during the financial industry fraud crisis in 2009. It hasn’t required the banks to do anything in return for that bailout, or for the protections from foreign competition that the government has given the banks since 1967.
Canada’s big banks also paid their CEOs about $12.5 million each in 2019 in salary and bonuses (55% higher than in 2008).
According to Fortune magazine’s Global 500 for 2017, three of Canada’s Big Six Banks ranked in the top 500 based on their revenues but are in the top 90 most profitable companies in the world: Royal Bank ($8.735 billion in 2017 profits; ranked #55 in total profits, #292 in revenue); TD Bank ($7.947 billion in 2016 profits; ranked #65 in profits, #337 in revenue); Scotiabank ($6.12 billion ranked #88 in profits, #430 in revenue). The profits of all three, and the other three Big Six Banks in Canada, all increased in 2018 and 2019 so they were all ranked even higher in the Global 500 for 2019. The three banks were the most profitable of the 11 Canadian companies in the Global 500 for 2017.
The federal government also continues to refuse to make the Big Banks pay their fair share of taxes to help pay the costs of the crisis. Canada’s Big Banks paid a tax rate of only 16% over the past 6 years — lower than banks in other G7 countries. The Big Banks also exploit tax loopholes more more than all other Canadian big businesses.
For more information, see Democracy Watch’s
Big Bank Coronavirus Accountability Campaign