Canadian Banks and Global Competitiveness

Canadian Banks and Global Competitiveness

JAMES L. DARROCH
Copyright Date: 1994
Pages: 352
https://www.jstor.org/stable/j.ctt81d4t
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  • Book Info
    Canadian Banks and Global Competitiveness
    Book Description:

    Darroch believes that knowledge of how the activities of these banks in international markets removed growth constraints from both the banks and the economy is vital to understanding the development of Canadian banking and the Canadian economy. In Canadian Banks and Global Competitiveness he surveys the strategies that produced the banks' high rankings. Using a case study approach, he examines the history of each bank from its founding to the passage of the 1992 omnibus financial services legislation, evaluating how its strategies have evolved in changing environments and exposing the long-term effects of corporate decisions and the profound effects of public policy on this regulated industry.

    eISBN: 978-0-7735-6443-5
    Subjects: Finance

Table of Contents

  1. Front Matter
    (pp. i-vi)
  2. Table of Contents
    (pp. vii-viii)
  3. Tables and Figures
    (pp. ix-xii)
  4. Acknowledgments
    (pp. xiii-2)
  5. CHAPTER ONE The Strategies of Canadian Multinational Banks
    (pp. 3-28)

    In the increasingly global competitive environment, there has been considerable concern for the competitiveness of Canadian industries. The financial services industry, however, is one that can be said to have competed successfully in international markets.¹ Four Canadian banks, the Royal Bank of Canada, the Canadian Imperial Bank of Commerce (CIBC), the Bank of Montreal, and the Bank of Nova Scotia (Scotiabank) rank among the 10 largest in North America, as can be seen in table I.I. Even more importantly, this table shows that these four are recognized by industry insiders to be among the best in both North America and...

  6. CHAPTER TWO The Bank of Montreal
    (pp. 29-79)

    As Canada’s oldest bank, or first bank as it prefers, the Bank of Montreal begins our historical study. The first bank provides an intriguing opportunity to study the effects of selection of competitive domain and its consequent influence on positioning in the intermediation chain and on organizational structure. The bank’s choice of customers and its impact upon positioning in the intermediation chain is of critical importance in understanding the strategy-structure evolution of the organization. By focusing on the effect of strategic positioning it becomes possible to understand more fully not only the distinctive character of the Bank of Montreal, but...

  7. CHAPTER THREE The Bank of Nova Scotia
    (pp. 80-120)

    Schull and Gibson made it quite clear in their history of the Bank of Nova Scotia, or Scotiabank, that in order to appreciate its recent strategies, it is necessary to understand the evolution and culture of the bank. They state that “The tradition of The Bank of Nova Scotia is non-conformist and non-establishment ... As a non-member of the establishment, with only a limited number of big accounts, The Bank of Nova Scotia has had to scurry for a living. Since it was difficult to obtain more big accounts in Canada, the Bank pursued big accounts abroad. If life had...

  8. CHAPTER FOUR The Royal Bank of Canada
    (pp. 121-167)

    The history of the Royal Bank of Canada reveals the successful pursuit of a growth strategy that sought to offer the broadest range of services to the greatest variety of customers.¹ This strategy was in place by the 1940s, as the 76th (1945) Annual Report made clear: “The details I have given you illustrate the policy and aim of the Bank to render banking services and assistance not to any narrow section, either in a business or a geographical sense, but to all classes of clients in the different communities served by our branches. We try to render this service...

  9. CHAPTER FIVE The Canadian Imperial Bank of Commerce
    (pp. 168-210)

    Just as Scotiabank and the Royal Bank reflected their Maritime origins and the Bank of Montreal its early government connections, so too did the Canadian Imperial Bank of Commerce (CIBC) develop according to its own unique pattern. More than the other banks previously studied, the CIBC was established to serve local interests.¹ It was less focused upon international trade than upon meeting the local banking needs of the community. Thus, while the nature of the Canadian economy demanded a certain degree of internationalization, the overall growth pattern of this bank revealed a stress on the early development of its Canadian...

  10. CHAPTER SIX Financial Performance and Strategic Change
    (pp. 211-247)

    The era ushered in by the 1980 Bank Act saw significant strategic change by the four banks. In order to understand such changes, it is important to add to our study a fifth bank, the Toronto-Dominion (TD). In the 1980s, the TD was generally ranked as the outstanding Canadian bank by both financial analysts and industry experts.¹ TD'S rank in table 6.I, which combines rankings fromEuromoney’s500 and 100 Best, attests to its strength. Ranking by shareholders’ equity as opposed to assets produces interesting differences from the ranking presented in table I.I. While TD is the smallest of the...

  11. CHAPTER SEVEN Changing Markets, Changing Srategies
    (pp. 248-270)

    It is impossible to understandwhyCanadian banks became major MNBS without understanding their strategies. By considering how the logic of intermediation demands the servicing of at least two distinct markets, growth strategies for intermediaries can be seen to be quite distinct from those of manufacturing firms. This was dramatically demonstrated in the 1970s with the recycling of petrodollars. OPEC countries had funds that far exceeded the ability of their capital markets to invest or more properly to absorb them. Consequently, they turned to foreign banks to “recycle” their funds by turning OPEC deposits into financial assets. The role of...

  12. APPENDIX ONE METHODOLOGICAL CONSIDERATIONS: THE VALUE OF CASE STUDIES
    (pp. 271-276)
  13. APPENDIX TWO A SHORT HISTORY OF THE BANK ACT AND RELATED EVENTS
    (pp. 277-280)
  14. Notes
    (pp. 281-306)
  15. Bibliography
    (pp. 307-324)
  16. Index
    (pp. 325-334)