US President Barack Obama said the performance of Canadian banks, alone among those of the Group of Seven nations in not receiving a government bail-out was striking. “Canada has shown itself to be a pretty good manager of the financial system in ways that we haven’t always been here in the United States,” Mr. Obama told a Canadian broadcaster.
The president spent Thursday in Ottawa meeting Stephen Harper, Canada’s prime minister, to discuss the economy, trade and the environment, in addition to any talk surrounding the strength of Canada’s banks. In large part because of their conservative culture Canada’s banks have remained the strongest in the G7 and, according to an October report by the World Economic Forum, the soundest in the world. “In Canada they do it the old-fashioned way, where when you need money you go to the bank and they review your file and they will lend you no more than 75% of the value of your house,” said Laurence Booth, a finance professor at the University of Toronto. “Canada is a more conservative place and, as much as it limits growth in good times, that approach pays off when others begin a race to the bottom.”
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