1. Banking

2. How do Canadians Bank? Online/ Internet banking ATM/ ABM bank machines
Telephone banking
Branches
Mobile banking

3. Banks Offer what Services?
Mortgages
Loans
Line of credit
Bank accounts
Investments – mutual funds

4. Banks Offer What Services?
Bank accounts – Transaction Accounts
Savings
Chequing
US funds
Student/Youth
Joint

5. How do banks make money? Interest from loans and credit cards
Lending out depositors money
Charging for services

6. The Bank of Canada Loans money to Chartered Banks
Bank Rate is the minimum interest it charges to lend money
The rate Chartered Banks charge to clients follows the Bank Rate
Bank rate reduces or increases supply of money in the economy (regulating supply)

7. The Bank Act
Federal government has control over money and banking (regulators)
Bank Act rules and regulations that banks have to follow
To be a bank have to apply for a charter from federal government
3 classes of banks

8. Types of Financial Institutions
Banks
Schedule I
Schedule II
Schedule III
Trust Companies
Credit Unions
Insurance Companies

9. Schedule I Owned by Canadian Shareholders
Shares traded on major exchanges
Accepts deposits, offer investment & financial services
Think Big Five

10. Schedule II Mostly foreign-owned banks Typically not traded publicly
Federal government limits number of branches and assets can hold

11. Schedule III
Foreign bank branches given permission to operate in Canada
Concentrate on investment banking and corporate customers

12. Trust Companies Provide most of the services offered by banks
Also assist in purchase of real estate, accounts “in trust”; i.e. charities, minors
The provincial governments regulate the “near banks”

13. Credit Unions
Organized and owned by groups of people who agree to pool and share their resources
Common bond of association; i.e. profession, employment, geography
Focused on individuals not corporations
Must own 1 share, each member has only 1 vote

14. Insurance Companies Life & health insurance Car & property insurance
Shares risk out amongst clients
Clients payments pooled and available to deal with accidents that occur

15. CDIC
Canadian Deposit Insurance Corporation (CDIC) is an agency of the federal government
Automatically insures deposits in financial institutions up to $100,000