Regulatory Changes and Financial Structure: The Case of Canada
The author documents some stylized facts about the Canadian financial structure. He explores these empirical facts in the context of Canadian financial legislation and finds that, over the 1990s, Canadian businesses became more heavily dependent on financial markets as their primary source of external funding. Data display a trend towards a more "market-oriented" financial system. The analysis suggests that this new trend started after the 1980 amendments to banking legislation and was considerably accentuated after the 1992 amendments. The author constructs a new series for the off-balance-sheet activities of Canadian banks that converts the non-interest income of banks into a credit equivalent. Combined with other evidence, this credit-equivalent series suggests a healthy growth trend in banking activity. Financial institutions are broadening their business lines and participating more actively in the arrangement of market financing. Regarding direct finance, the data indicate that Canadian firms issue a substantial share of their bonds in the U.S. bond market, and an increasing share of their stocks in the U.S. stock market. The author conjectures that there is some form of incompleteness in the Canadian markets. A noticeable fraction of Canadian issuances in the United States involves riskier firms for which U.S. markets seem more mature.
|Date of creation:||2004|
|Date of revision:|
|Contact details of provider:|| Postal: 234 Wellington Street, Ottawa, Ontario, K1A 0G9, Canada|
Phone: 613 782-8845
Fax: 613 782-8874
Web page: http://www.bank-banque-canada.ca/
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Kevin J. Stiroh, 2002.
"Diversification in banking: is noninterest income the answer?,"
154, Federal Reserve Bank of New York.
- Stiroh, Kevin J, 2004. "Diversification in Banking: Is Noninterest Income the Answer?," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 36(5), pages 853-82, October.
- John H. Boyd & Mark Gertler, 1994.
"Are banks dead? or, are the reports greatly exaggerated?,"
25, Federal Reserve Bank of Chicago.
- John H. Boyd & Mark Gertler, 1994. "Are banks dead? Or are the reports greatly exaggerated?," Quarterly Review, Federal Reserve Bank of Minneapolis, issue Sum, pages 2-23.
- John H. Boyd & Mark Gertler, 1994. "Are banks dead? or, are the reports greatly exaggerated?," Working Papers 531, Federal Reserve Bank of Minneapolis.
- John H. Boyd & Mark Gertler, 1995. "Are Banks Dead? Or Are the Reports Greatly Exaggerated?," NBER Working Papers 5045, National Bureau of Economic Research, Inc.
- Freedman, C. & Goodlet, C., 1998. "The Financial Services Sector: Past Changes and Future Prospects," Technical Reports 82, Bank of Canada.
- Freedman, C., 1998. "The Canadian Banking System," Technical Reports 81, Bank of Canada.
- Franklin Allen & Douglas Gale, 2001. "Comparing Financial Systems," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262511258, December.
When requesting a correction, please mention this item's handle: RePEc:bca:bocawp:04-26. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If references are entirely missing, you can add them using this form.