Is the Canadian banking system really “stronger” than the U.S. one?

Christian Calmès () and Raymond Théoret ()
Additional contact information
Raymond Théoret: Chaire d'information financière et organisationnelle ESG-UQAM, Université du Québec (Montréal), Université du Québec (Outaouais)

RePAd Working Paper Series from Département des sciences administratives, UQO

Abstract: The Canadian banking system is considered one of the “best” in the world (Bordo et al., 2011). To examine this question we compare the risk-return trade-off of Canadian and U.S. banks in the context of market-based banking. We find that the sources of non-traditional income are actually more volatile in Canada, essentially because Canadian banks are more involved in trading and capital markets business lines than their U.S. peers. Even though U.S. banks are more exposed to securitization, which contributes to increase bank risk, our analysis does not allow us to conclude that the Canadian banking system is performing significantly better. On one hand, Canadian banks do better in downturns; on the other hand however, depending on the statistics, U.S. banks tend to benefit more from the transition to market-based banking.

Keywords: Bank performance; Market-oriented banking; Securitization; Non-interest income; Financial stability. (search for similar items in EconPapers)
JEL-codes: C32 G20 G21 (search for similar items in EconPapers)
Pages: 43 pages
Date: 2013-05-23
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.repad.org/ca/qc/uq/uqo/dsa/cifo2013-03.pdf First version, 2013 (application/pdf)
Our link check indicates that this URL is bad, the error code is: 500 Can't connect to www.repad.org:80 (No such host is known. )

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pqs:wpaper:022013

Access Statistics for this paper

More papers in RePAd Working Paper Series from Département des sciences administratives, UQO Contact information at EDIRC.
Bibliographic data for series maintained by Christian Calmes ().