Investing in Bank-Based Public Companies: A Guide for Canadians

Historical Stability

The Canadian banking system's reputation for stability dates back to its founding principles in the 19th century. Unlike many global counterparts, Canadian banks emerged from the 2008 financial crisis relatively unscathed, demonstrating the effectiveness of Canada's regulatory framework.

The Big Six Dominance

Canada's banking sector is dominated by six major banks, collectively known as the "Big Six":

• Royal Bank of Canada (RBC)
• Toronto-Dominion Bank (TD)
• Bank of Nova Scotia (Scotiabank)
• Bank of Montreal (BMO)
• Canadian Imperial Bank of Commerce (CIBC)
• National Bank of Canada

Dividend History

One of the most compelling aspects of Canadian bank stocks is their impressive dividend history. Many have paid dividends consistently for over 100 years, even during major economic downturns.

Global Expansion

Canadian banks have successfully expanded internationally, particularly into the United States, Caribbean, and Latin America, providing diversification benefits to investors.

Future Outlook

Despite challenges such as low interest rates and technological disruption, Canadian banks continue to adapt and evolve. Their investment in digital transformation and focus on customer experience positions them well for future growth.