George Gibson Coote
United Farmers of Alberta
The article continues:
Two "logical combinations at once suggest themselves. A "logical" combination is apparently one that will get by the Minister of Finance, who has declared himself as opposed to shifting the balance in banking as between Montreal and Toronto. Thus. Toronto banks may merge only with Toronto banks and Montreal banks with Montreal banks.
In Toronto the four banks that are left out of the seven after the Big Three-Montreal, Royal and Commerce-have been eliminated from discussion are the Nova Scotia, Dominion, Imperial and Toronto. A few years ago there was talk of a merger between the latter three. This has been revived, though probably to the embarrassment of the officers of these banks who declare that such a merger is purely hypothetical.
Such a merger would provide a bank with total assets of $400,000,000 as follows: Dominion, $151,000,000; Imperial, $147,000,000; Toronto, $142,000,000.
In Montreal there are only two banks outside of the Big Three, the Banque Canadienne Nationale and the Banque Provinciale du
Bank Act-Mr. Coote
Canada. A merger of these two has been, from time to time, discussed but again quite unofficially. It is not certain that either side wants it. But both banks are French Canadian in aspect. Their combined assets would total over $200,000,000. The figures follow: Canadienne Rationale. $119,000,000; Provineiale, $55,000,000: Total, $201,000,00.
Neither of these combinations would provide a bank to rank in size with the Big Three, although they would be substantial institutions for all that.
About the only way that a fourth large bank in the three-quarter billion dollar class could be set up by a merger of the present banks would be in the union of the Nova Scotia, Toronto, Dominion and Imperial. The combined assets of these four would be as follows: Nova Scotia, $260,000,000; Dominion, $151,000,000; Imperial, $147,000,000; Toronto, $142,000,000: Total, $700,000,000.
This would create a bank that would be practically neck and neck with the Commerce.
All four of the banks mentioned have their administrative head offices in Toronto.
If, as leading bankers say, Canada is to get down to a few large banks, it must be by merger of the existing banks and the mergers above discussed are the "logical" ones.
But several things stand in the way of their consumrhation. The shareholders and directors of the banks referred to may prefer to let each bank go its own gait, as they are doing very successfully right now. Or the government might not permit further mergers, although its policy in that regard seems to exist only for the breaking thereof. But what is more important, and probable, the public may have had its fill of mergers and refuse to accept any more such combinations without expressing its disapproval.
But as the Bank Act now stands how can the public prevent any further mergers? The matter is absolutely in the hands of the Minister of Finance once banks make up their minds to merge, and it does seem to me, sir, that the policy of the present minister is to approve all the mergers that are asked of him. He seems to be, as the good book says-
Subtopic: BANK MERCERS-PROPOSED APPROVAL OF PARLIAMENT