Canadian banks are typically leveraged at 18 - 1- compared with U.S. banks at 26 to 1 Guess which country, alone in the industrialized world, has not faced a single bank failure, calls for bailouts or government intervention in the financial or mortgage sectors. Yup, it's Canada. In 2008, the World Economic Forum ranked Canada's banking system the healthiest in the World. America's ranked 40th,Britain's 44th.
Canadian banks are well capitalized and poised to take advantage of opportunities that American and European banks cannot seize. The Toronto Dominion Bank, for example, was the 15th largest Bank in North America one year ago. Now it is the fifth-largest. It hasn't grown in size; the others have all shrunk.
So what accounts for the genius of the Canadians? Common sense. Partly this reflects Canada more risk-averse business culture, but it is also a product of old fashioned rules on banking.