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Too Small to Fail: Canadian Banks, Regulation, and the North American Financial Crisis

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  • Brox, James A.

Abstract

This paper examines the recent performance of Canadian banks in light of the recent North American financial crisis. The extent of the spread of the crisis to the Canadian financial sector is analyzed, and the resulting impacts on the Canadian banks’ balance sheets are studied using information from the Canadian financial flow matrix as published by Statistics Canada. The constrained financial flow model estimated and simulated in this study shows that while there has indeed been some spillover from the United States into the Canadian banking sector, this result is much more modest than in the United States. Some policy issues with respect to tax and regulatory structure are discussed in conclusion.

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  • Brox, James A., 2009. "Too Small to Fail: Canadian Banks, Regulation, and the North American Financial Crisis," The Journal of Economic Asymmetries, Elsevier, vol. 6(2), pages 31-46.
    • Handle: RePEc:eee:joecas:v:6:y:2009:i:2:p:31-46
    DOI: 10.1016/j.jeca.2009.02.005
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    Cited by:

    1. Peterson K. Ozili, 2022. "Difficult Issues in Financial Regulation for Financial Stability," Contemporary Studies in Economic and Financial Analysis, in: The New Digital Era: Other Emerging Risks and Opportunities, volume 109, pages 55-67, Emerald Group Publishing Limited.
    2. James A. Brox, 2010. "Canadian Banks and the North American Housing Crisis," Chapters, in: Benton E. Gup (ed.), The Financial and Economic Crises, chapter 3, Edward Elgar Publishing.

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    More about this item

    Keywords

    L5; G21; E44; Financial regulation; Banking; Flow of funds;
    All these keywords.

    JEL classification:

    • L5 - Industrial Organization - - Regulation and Industrial Policy
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy

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