Credit system of Canada has a complex institutional structure, the creation of which had a strong influence credit systems of the USA and the UK. These countries aspired to strengthen its position in Canada by means of mastering national sources of financing.
Credit institutions emerged in the colonial period, the functions of bankers performed a trading company. In Canada acted in various branches of foreign credit institutions. First commercial Bank of Canada was established in 1817 – “the Bank of Monreal”. Then there is a number of specialized institutions: insurance companies, trust and mortgage companies, etc.
The first world war had a strong impact on the strengthening of commercial banks, followed by a more rapidly evolving non-banking institutions: Finance company sales in installments and consumer credit, insurance and trust companies.
The world economic crisis of the 1930s had a negative impact on the credit system, commercial banks in particular and other credit institutions. During this period, created the Bank of Canada, increased government intervention in the credit system, and stimulates the activity of specialized state institutions lending for housing construction and agriculture.
Improvement of the credit system continued during the Second world war and after it, there are new types of specialized credit institutions: leasing companies, state insurance companies, company pension provision.
Modern credit system of Canada includes: the Central issuing Bank, commercial banks, specialized agencies. The Central emission Bank – the Bank of Canada. The number of commercial banks are small; the provinces of the credit institutions act provincial level. The credit system of the country is characterized by the presence of the following major financial institutions: commercial, trust and mortgage banking, insurance and investment companies. Private commercial, or so-called chartered banks enjoy full freedom in commercial activity. It is governed by the parliamentary charters. Chartered banks in their purpose are designed to serve industrial, commercial and public sectors of the economy. They carry out Deposit operations, provide various kinds of loans to be engaged in foreign exchange transactions.
The canadian bankers Association, the Supreme body is the Executive Board is in charge of the clearing system in Canada. Directly leads the work of the system of payments between banks, the so-called Committee of the clearing and information centers. He has organized 10 regional clearing houses, referred to as clearing houses. Regional clearing houses exist in Ottawa, calgary, Halifax, Montreal, Quebec city, Regina, Saint John, Toronto, Vancouver and Winnipeg. Their activities directly managed by a local clearing Association in accordance with the mandates received from the Association of canadian bankers.
In other institutions, or, as they are called in the country, “nonbank financial intermediaries” (NBPP). They also carry out banking transactions. This category includes credit unions and co-operative .financial institutions serving mainly French-speaking population. NBFP very heterogeneous. In addition to these these include independent trust banks and trust departments of commercial banks.
As in other leading capitalist countries, in Canada, developed the insurance business. In the country there is rather high degree of concentration of insurance capital. In the local insurance market is quite firmly established American companies; from 172 foreign firms operating in Canada, 134 – from the USA. In turn, the American market is the main sphere of foreign expansion of canadian insurers. In the US there are 71 canadian insurance company (UK — 7, in Hong Kong – 6).