VANCOUVER, BRITISH COLUMBIA--(Marketwire - May 31, 2012) - In a keynote luncheon speech to the Vancouver Board of Trade, Canadian Bankers Association (CBA) president Terry Campbell today discussed how banks have contributed to B.C.'s economic success.
He highlighted the central role that banks have played in financing some of B.C.'s growth: "Last year in B.C. alone, banks authorized $12 billion to the construction industry, almost $7.4 billion to manufacturing, $4.4 billion to mining, quarrying and oil wells, and $3.4 billion to agriculture. If you take small and medium-sized enterprises as a whole, bank lending totalled almost $12 billion in this province alone."
"Put simply, banking customers in British Columbia and across Canada are best served by strong and profitable banks, and that is best achieved when we get the balance right between regulation on the one hand and innovation and competitiveness on the other," said Mr. Campbell.
Maintain B.C.'s Competitive Taxation Regime
Mr. Campbell commended the B.C. government's decision in recent years to eliminate capital taxes and reduce corporate and personal income tax rates to make B.C. more attractive to businesses, which helps strengthen B.C.'s economy. He cautioned against any changes to B.C.'s competitive taxation regime that could hurt the province's productivity.
"Unfortunately, we're seeing some troubling trends in some provinces, and calls from some people in B.C., when it comes to taxing the capital of financial institutions - something that is both perverse and counter-productive for the growth of the economy," said Mr. Campbell. "Perverse because banks are required to have large amounts of capital for safety and soundness reasons, and it doesn't make sense to tax what is needed for prudential reasons. Counter-productive because capital supports lending and when you tax away capital you are reducing the availability of credit to other sectors of the economy."
The Continued Need for a National Securities Regulator
Mr. Campbell also discussed the continued need for a national securities regulator and Ottawa's evolving approach to securities regulation following the Supreme Court of Canada ruling last December.
"Ottawa's approach to securities regulation is evolving given the Supreme Court of Canada's opinion of last December," he noted. "We know that your government has been an active participant in the project, and we commend the government for that. We encourage them, along with all other provincial and territorial governments, to continue to work with the federal government to develop a common securities regulatory regime that has the capacity to support fair and competitive markets for all Canadians."
Strong Banks, Effective Regulation and Supervision
Mr. Campbell also spoke about how banks in Canada came through the recent global financial crisis without any taxpayer funded bailouts, there were no bank failures and they continued to lend, which was not the case with many banks in many other countries around the world.
"I cannot emphasize enough the importance to our economy of having strong, properly functioning banks. And we cannot take this strength for granted. It's something that bankers, policy-makers and regulators must continually work at," said Mr. Campbell. "We have a strong, sound and profitable banking system in Canada. One that benefits the economies of British Columbia and Canada. But also one that benefits bank customers - be they individual consumers or businesses large or small."
As governments and regulators move forward with implementing rules and policies that affect banks, Mr. Campbell urged them to consider whether these new rules will ensure that Canada's banking system is able to maintain its strength, its innovation and its service to customers. The opportunity for Canada through this process is to ensure that our banks retain their reputation, and their position, as being the strongest and soundest in the world.
Progress Made Reducing Bank Robberies But Efforts Continue
Mr. Campbell concluded his speech by raising the issue of the high rate of bank robberies in B.C. The banking industry meets regularly with law enforcement and other financial institutions and business groups to share best practices and strategies on how to reduce bank robberies in Vancouver. There have been positive results but more needs to be done.
"Here's the good news: bank robberies have declined in B.C. over the last ten years - thanks to efforts by the police, the government which has dedicated Crown Prosecutors to the issue, and of course, the banks themselves. But let's be clear: robberies are still a very real problem, particularly in Greater Vancouver," said Mr. Campbell.
The full text of Mr. Campbell's speech can be found on the CBA's website at the following link:
http://cba.ca/en/component/content/publication/68-speeches-and-presentations
About the Canadian Bankers Association
The Canadian Bankers Association works on behalf of 53 domestic banks, foreign bank subsidiaries and foreign bank branches operating in Canada and their 274,000 employees. The CBA advocates for effective public policies that contribute to a sound, successful banking system that benefits Canadians and Canada's economy. The Association also promotes financial literacy to help Canadians make informed financial decisions and works with banks and law enforcement to help protect customers against financial crime and promote fraud awareness. www.cba.ca.
Follow the CBA on Twitter: @CdnBankers
Contact Information:
Robin Walsh
Cell: (613) 325-5128
rwalsh@cba.ca
www.cba.ca