Alexia Addona Jonathan Beaudoin Yannick Bérubé Elric Boisvert

 Brief Overview of Present System  Banking Structure:  Bank of Canada & Regulations  Banking Practices:  Retail Banking  Wealth Management  Brokerage Activities  Big 5 & Subsidiaries  Second Tier Banks  Other Financial Institutions

 Extremely competitive industry.  Over 3,000 competitors.  Some in niche markets, some in all markets (like Big 5).  Banks’ role is to channel funds from individuals, institutions, etc., who have surplus funds to people who wish to use those funds.  Other roles: payment system, vehicle for Canadian monetary policy and as the federal government's instrument for some social and political policies.  Mergers highly regulated and often turned down.  Example: 1990s RBC/BMO and CIBC/TD mergers.

 Bank of Canada  CDIC  Chartered banks  Big 5 and affiliates  Second tier banks  Other financial institutions  The Office of the Superintendent of Financial Institutions (OSFI)

Founded in 1935 in Ottawa Public institution Independent from the government Led by the Governing Council

 “Bank of the commercial banks’’  Controls inflation  Regulation of the interest rates  Supplier of Canada’s bank notes  Fiscal agent of the Government of Canada  Research on domestic and foreign financial markets  Lender of last resort

 Role of the Minister of Finance  Canada Deposit Insurance Corporation (CDIC)  Rules on capital, liquidity, and management of systematic risk  Bank Act

Retail Banking  Bank executes transactions with consumers  Service offered: personal loans, debit cards, savings account,etc Wholesale Banking  Deals with corporations and other banks.  Services offered: Currency conversion, working capital financing, corporate loans, etc

Wealth Management  Combination of financial investment advice, accounting/tax services and legal planning for one fee. Mutual Funds  An investment vehicle that is made up of a pool of funds collected from many investors for the purpose of investing in securities.  Goal is to earn capital gains

Insurance  A practice or arrangement by which a company or government agency provides a guarantee of compensation for specified loss, damage, illness, or death in return for payment of a premium. Credit Cards  A credit card is a payment card issued to users as a system of payment. It allows the cardholder to pay for goods and services based on the holder's promise to pay for them.payment card paymentcardholder Brokerage Activities  Brings buyers and sellers of investments together. They charge a commission on every transaction.

1.Royal Bank of Canada (RBC) 2.TD Canada Trust (Toronto- Dominion Bank) 3.Scotiabank (Bank of Nova Scotia) 4.Bank of Montreal (BMO) 5.Canadian Imperial Bank of Commerce (CIBC)  Schedule I banks  Operational head offices located in Toronto  Stable and Conservative  Services offered by all five: Retail banking, wholesale banking, wealth management, mutual funds, insurance, credit cards, brokerage activities, and have large international subsidiaries.

 RBC is Canada’s largest bank by its assets and market capitalization.  One of the largest in the world based on market capitalization. (#12 with 99.63$US billion)  Operates in Canada, the United States, and 44 other countries.  Canada and U.S. operations: 81.8% of total revenue  Employs 79,000 full and part- time employees.

 TD challenges RBC for largest bank in Canada, with a slight advantage in total assets (1.61 $US billion).  TD is ranked at #13 for largest bank in the world based on market capitalization, with 88.21$US Billion.  Operates mainly in Canada and United States:  Canada: 66.1% of total revenue  United States: 26.4% of total revenue  Employs 78,748 full and part- time employees.

 Scotiabank operates in the Americas, in Europe, in the Middle East, and Asia Pacific.  It has 4 diversified growth platforms: International Banking (34.8%) Canadian Banking (33.4%) Global Wealth and Insurances (19.1%) Global Banking and Markets (17.1%)  Grew by 21% in 2013 by acquiring ING Direct.  Ranked at #24 for largest bank in the world by market capitalization with 69.46$US billion.  Employs 83,874 full and part-time employees.

 The Bank of Montreal primarily operates in North America: Second largest Canadian bank by retail branches in North America. 97.1% of total revenue from Canada and US operations.  BMO’s main business segments: Commercial Banking – Canada (39%) Wealth Management (21.2%) BMO Capital Markets (21.1%) Commercial and Personal Banking - US (18.1%) Corporate Services (0.6%)  Ranked at #42 for largest bank in the world by market capitalization with 45.56$US billion.  Employs 45,631 full and part-time employees.

 CIBC operates in Canada, Europe, Asia Pacific, and the Americas, however 86% of its total revenue are from Canada.  CIBC’s main business segments: Retail and Business Banking (65%) Wholesale Banking (17.7%) Wealth Management (14.1%) Corporate and Other (3.1%)  Ranked at #54 for largest bank in the world by market capitalization with 34.15$US billion.  Employs 43,039 full and part- time employees.

Royal Bank of Canada (RBC) Toronto-Dominion Bank (TD) Bank of Nova Scotia (Scotiabank) Bank of Montreal (BMO) Canadian Imperial Bank of Commerce (CIBC) U.S. retail banking RBC BankRBC Bank *Note: Sold in June 2011 TD BankNoneHarris BankNone* Other major international retail banking operations RBC Royal Bank of CanadaRBC Royal Bank of Canada and RBTT (Caribbean branches) RBTT Scotiabank International FirstCaribbean Private banking RBC Wealth Management TD Waterhouse Private Banking Scotia Private Client Group BMO Harris Private Banking CIBC Private Banking Canadian mutual funds RBC FundsRBC Funds and PH&N Funds PH&N Funds TD Mutual Funds Scotia Mutual Funds BMO Mutual FundsBMO Mutual Funds and Guardian Group of Funds Guardian Group of Funds CIBC Mutual Funds U.S. mutual fundsTamarack Funds Canadian brokerage RBC Direct InvestingRBC Direct Investing and RBC Dominion Securities RBC Dominion Securities TD WaterhouseScotiaMcLeodBMO InvestorLine BMO InvestorLine and BMO Nesbitt BurnsBMO Nesbitt Burns CIBC Investor's EdgeCIBC Investor's Edge and CIBC Wood GundyCIBC Wood Gundy

Royal Bank of Canada (RBC) Toronto-Dominion Bank (TD) Bank of Nova Scotia (Scotiabank) Bank of Montreal (BMO) Canadian Imperial Bank of Commerce (CIBC) U.S. brokerage RBC Wealth Management RBC Wealth Management formerly RBC Dain Rauscher TD Ameritrade TD Ameritrade (45%) BMO Harris Investor Services International Brokerage West Indies Stockbrokers Limited TD Waterhouse TD Waterhouse (UK), TD Direct Investing International (LU) Canadian insurance RBC InsuranceTD InsuranceScotia InsuranceBMO Life CIBC Creditor InsuranceCIBC Creditor Insurance, CIBC Travel InsuranceCIBC Travel Insurance Capital markets RBC Capital Markets TD SecuritiesScotia Capital BMO Capital Markets CIBC World Markets Major custodial operationscustodial operations RBC DexiaRBC Dexia (June 27, 2012, RBC purchased the remaining 50% from Dexia) CIBC Mellon CIBC Mellon (50%) Precious metals ScotiaMocatta

 ATB Financial  Canadian Western Bank  National Bank of Canada  Laurentian Bank  Desjardins Group (technically not a bank but an alliance of credit unions)  HSBC Bank  Tangerine Bank (formerly ING)  Second tier banks are smaller, less successful banks than the main banks.

Credit Unions  A credit union is a member- owned financial cooperative, democratically controlled by its members, and operated for holding deposits, providing credit, and providing other financial services.  Many credit unions also provides services intended to support community development.

Trust Companies  A legal entity that acts as a fiduciary on behalf of a person or business for the purpose of management and the eventual transfer of assets to a beneficial party.  There are often tax advantages associated with using trusts to transfer ownership of assets.

Insurance Companies  Insurance companies pool risk by collecting premiums from a large group of people who want to protect themselves, loved ones against particular losses.  Insurance helps manage risk and preserve wealth

Brokerages  A brokerage acts as an intermediary between buyers and sellers to facilitate securities transactions.  Commission on every transaction compensates brokerage companies.  A brokerage can either be full service or discount.

 Big Five  Financial institutions also include credit unions and brokerages as well as others, not only banks.  Many regulations to minimize risks and catastrophic outcomes.  Considered one of the safest banking systems in the world…  Now what?