New York – Those wily Canadians are making a play for the U.S. securities markets. It is well know that the Canadian banks did not have as large a fall out as the U.S. or European banking systems. This was primarily because the Canadian banks still believe that deposits matter and were less leveraged than their international Brethren. What is less known is that 90% of the population of Canada is within 10 miles of the US border—poised to attack.
While all of the Canadian banks have businesses in the U.S., the Bank of Montreal is making a major move to take market share. BMO has added a total of 450 capital markets professionals for the U.S. in the past year. The roster includes 23 senior equity sales and trading professionals.
BMO’s goal is to dominate mining stocks globally. Canada already has more publically-listed mining stocks than any other country and BMO has a solid grip on this sector already. Other Canadian banks taking a run at the U.S. markets include Toronto Dominion, which recently purchased Commerce Bancorp for $8.5 billion, owns TD Waterhouse Asset Management and on-line broker TD Ameritrade. CIBC World Markets has been around for a few decades and RBC Dominion (80,000 employees and 18 million clients worldwide) has a solid business in the capital markets, wealth management and banking in the U.S. market and is the 13th largest bank in the world by market cap. By contrast, JP Morgan is 4th, Bank of America is 7th, Citibank is 9th and Goldman is 12th.
A fourth Canadian bank that has been in the U.S. for some time—Scotia Capital—appears to be trying to take addition market share in the emerging markets and at home. In March, Scotia acquired the Bank of Scotland’s wholesale banking business in Columbia and in September, the bank expanded its footprint in Brazil through acquisitions. Scotia has also been recognized as the best investment bank and the best corporate underwriter in Canada.
While the European and U.S. banks continue to gain their bearings after the financial meltdown, the Canadian banks are looking to build, both internally and through acquisitions in the coming months.