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Financial Services

Canada

Rock-solid Financial Services

Amidst the global financial turbulence, Canada stands out as a safe – and financially sound – destination for investors. From the World Economic Forum to the International Monetary Fund, Canada earns top marks for having the strongest banking system and has one of the most highly developed financial services sectors on the planet.

Canada's financial services industry is world-class and globally oriented, with over $60 billion in acquisitions outside Canada since 2000. This dynamic sector is an equally powerful force on the domestic front, employing 750,000+ people and generating over 6% of national GDP of $78 billion in 2007. A highly-skilled workforce, advanced telecommunications infrastructure and conducive business environment create fertile ground for future growth. Investors looking for high yields can bank on it.

Look what Canada has to offer

  • Canada's banks are ranked #1 globally by the World Economic Forum
  • 2nd most attractive global centre for information technology/business process outsourcing
  • 3rd largest financial centre in North America
  • Highly-educated population and some of the best business schools in the world
  • 7 of the top 10 locations internationally for low operating costs

First for a reason

Canada’s highly-diversified Financial Services sector is composed of banks, trust and loan companies, credit unions and caisses populaires, insurance firms, securities dealers and exchanges, mutual fund companies and distributors, finance and leasing firms, as well as pension fund managers and independent financial advisors, insurance agents and brokers.

Sound Banking System

Canadian financial institutions are strong, stable, well diversified and well funded with healthy balance sheets. The banking system’s strong capital position – with capital adequacy ratios above the International Monetary Fund’s Basel minimums for effective banking supervision – is sufficiently financed against loan losses. The stronger financial position of Canadian banks means they now borrow at rates considerably lower than those of many of their international counterparts.

Leadership

Global leaders like Royal Bank of Canada and Manulife Financial attest that Canada’s financial services sector is one of the most sophisticated in the world – and the world has taken notice. The Financial Services sector continues to attract foreign investment, valued at $54 billion in 2006, and many major international financial services firms (e.g. BNP Paribas, CITCO) maintain business processing near-shore operations in Canada. The industry’s leadership extends beyond Canada’s borders. The six largest banks are active in the United States, Latin America, the Caribbean and Asia. The Canadian life and health insurance sector is even more internationally oriented, with branches and subsidiaries in more than 20 countries, with $77.7 billion of their world-wide premiums generated abroad.

Regulatory oversight and reporting

Canada has a well developed general legal and securities regulatory framework. The Canadian financial services sector offers many examples of best practice. The institutions, markets, infrastructure, safety nets, and oversight arrangements that make up the comprehensive system are sophisticated, and include a full range of financial intermediaries.

Near-shore operations

Canada’s geographic location and sound business practices make it a favourite nearshoring/outsourcing destination for investors and one of the world’s top business process outsourcing markets. More than simply local market centres, these key value creation centres support global clients.

Competitive clusters

With Canada’s large pool of talented workers, advantageous labour and operating costs, as well as its outstanding quality of life – #1 in the G7 – any Canadian city offers an excellent location to do business. However, several centres stand out for their competitive advantages:

Toronto
Canada’s largest city is a recognized finance hub, the 3rd largest financial centre in North America behind New York and Chicago and Canada’s financial and business capital. In 2008, Forbes ranked Toronto as the world’s 10th most economically powerful city. Toronto accounts for over 10% of Canadian economic activity, at $123 billion, and boasts 205,000 people working in the financial services sector alone. The city is the site of the Toronto Stock Exchange – not only Canada’s largest securities exchange but also North America’s 3rd largest exchange and the world’s 7th largest based on market cap. The clustering of financial services has attracted highly skilled knowledge workers and a multi-lingual labour force. Top notch universities ensure a steady supply of graduates, many from prominent business schools.

Montréal
Montréal’s dynamic financial services sector is growing faster than the entire services sector, at 3.4 percent in 2007. Over 3,000 companies employ more than 100,000 people. Major players include Desjardins, National Bank and HSBC in the banking sector, and Standard Life and Sun Life Financial in the insurance sector. Montréal also hosts the International Financial Centre program, created to facilitate corporations or partnerships specializing in international financial transactions. The city’s 30 academic research centres excel in derivative products and pension fund management, mathematical and computational finance, and financial engineering. World-class universities produce the next generation of innovators, drawn by the city’s internationally-recognized cosmopolitan ambience.

Calgary
Calgary is North America’s fastest growing economic region and Western Canada’s financial and business centre, fuelled by mega-energy projects in the region. Over the last decade, employment growth in the financial services industry has exploded – growing 48% faster than the provincial economy and twice as fast as the national economy. Calgary’s financial services sector comprises banking and insurance, brokerage, credit intermediation, currency trading and hedging, asset management, financial analysis, accounting, commodity trading and investment banking and employs over 22,000 people at more than 1,200 businesses.

Vancouver
Vancouver is Canada’s gateway to the Asia-Pacific markets; coupled with strong cultural connections, financial services firms in Vancouver enjoy a strong competitive advantage in this region of the world. Vancouver has branches of the TSX Venture Exchange and the Toronto Stock Exchange, 30 foreign banks and 15 international financial institutions including the Canadian headquarters of HSBC. The city is one of two International Finance Centres in Canada, and through the Province’s International Financial Activities Act (IFAA), Vancouver is developing an important niche in international treasury and financial functions, including factoring, import/export financing, foreign exchange, and back-office support.

Winnipeg
Winnipeg is home to an experienced workforce of 104,000 people in business, finance and administrative services, with over 20,000 employed in financial services. The city also hosts industry-leading insurance, mutual funds and leasing firms. Great-West Lifeco Inc., Canada’s largest insurer, operates subsidiaries in Canada, the U.S. and Europe and manages over $390 billion in combined assets. IGM Financial Inc. is Canada’s largest mutual fund distributor, with more than $122 billion under management. Both are headquartered in Winnipeg.

Halifax
Halifax’s talented labour force of 79,000 people in business, finance and administrative services, along with 7,000+ students enrolled in business administration, have attracted ING, CITCO Fund Services, Butterfield Fund Services, Marsh Captive Solutions and Olympia Capital. Halifax has the most employees with a degree, diploma or certificate in the country, and has one of the most satisfied workforces in Canada. When compared to 10 locations known for their status as financial centres, Halifax offers: the lowest cost area for salaries and wages, statutory and other fringe benefits; the lowest cost area for facility lease costs; and among the lowest cost areas for utility costs.

Charlottetown
Charlottetown’s 20% savings on labour rates and 30% on space costs create an ideal financial services processing location. Over 5,800 people in Charlottetown work in the business, finance and administration industry, specializing in banking, mutual fund administration, client relations, hedge fund administration and insurance. Charlottetown is home to 15 international financial institutions, including AIM Trimark and Ceridian.