Canada remains a stronghold for investors, with sound systems and ample protection against the elements. CIBC Mellon’s Shane Kuros reports

Geographically standing alone at the top of North America, Canada is a nation with exciting qualities rarely found around the globe: a vast physical landscape, an abundance of natural resources, and a strong financial sector, ripe for international investors to discover and explore.

Canada is acknowledged as one of the best sovereign nations in which to do business, and our financial sector continues to earn global acclaim. In 2014, our banking system was named the soundest in the world for the seventh year in a row by the World Economic Forum, and our nation maintains one of the few triple-A credit ratings for sovereign debt.

As outlined in the Bank of Canada’s most recent financial system review, the country continues to find success amid a challenging global environment. In the review, the Bank of Canada said: “Once we have seen a sustained increase in export demand, uncertainty about the future will diminish and firms will respond.”

“Our research indicates that many of the export sectors that we expect to lead the expansion still have some excess capacity to meet higher demand. This is one reason why our productivity growth has picked up recently. The implication is clear; a sustained expansion in our exports not only will represent new demand, it will ignite the rebuilding phase of our business cycle, which will create new supply.”

Stability is one of the strongest attributes of Canada’s financial sector. The regulatory environment in which market participants operate has garnered well-justified praise for fostering strong risk management, governance and best practices across the industry. The Canadian Office of the Superintendent of Financial Institutions (OSFI) regulates federally registered banks and insurers, and trust and loan companies in Canada, with slight differences in rules and regulations for each province and territory.

While Canada’s environment is complex, regulators are constantly looking to strengthen the sector. For example, the individual governments of Canadian provinces British Columbia, Ontario, Saskatchewan, New Brunswick and Prince Edward Island are undertaking an initiative with the Canadian government to enforce capital markets rules and regulations nationally, rather than provincially and territorially.

Canada’s Department of Finance noted that “a cooperative capital markets regulatory system will strengthen Canada’s capital markets by providing better protection to investors, enhancing Canada’s financial services sector, and managing systemic risk … A common regulator will administer a single set of regulations, reducing red tape for businesses”.

Regulatory demands in the marketplace, both global and domestic, continue to evolve as well, and those who implement fluid and dynamic rules will have a much easier time adapting to them. In the Canadian marketplace, reconciling domestic activities with cross-border regulations is a key consideration. Local expertise and insights are intangibles that attract global investors, as domestic suppliers work with entrants to the Canadian market to find solutions that mitigate risk and satisfy the requirements of both local and global regulations.

Many protections exist in the Canadian market. The Canada Deposit Insurance Corporation (CDIC) protects a client’s savings against the failure of a bank or other CDIC member institution. They provide insurance up to specified limits for money deposited in a CDIC member, in the event of that member becoming bankrupt. Similar to the CDIC, the Canadian Investor Protection Fund (CIPF) provides insurance regarding securities, cash and other property held in a client’s account, should an investment dealer become insolvent. In the Canadian Derivatives Clearing Corporation, Canada also has the only central clearing counterparty for exchange-traded derivative products in North America.

Navigating challenges is a matter of mutual education. At CIBC Mellon, we’re ready to assist global investors with our renowned client service delivery and relationship building methods, along with a deep knowledge of Canadian market mechanics, to create the right balance to satisfy both Canadian and global stakeholders.

The Canadian economy continues to grow with the emergence of vital and healthy sectors, and the banking system is one of the soundest in the world. With uncertainty and instability prevailing in various locations throughout the world, Canada stands out in terms of steadiness and opportunity for global investors. Now is the perfect time to explore everything Canada has to offer.

Country profiles
The latest country profiles from Asset Servicing Times
The Asian market may be improving on the harmonisation front, but the situation is still far from ideal. Experts discuss what there is still left to do
Brazil is hogging the limelight from its South American neighbours. But, although reforms are in full swing, there is still work to be done
Securities Lending Times

Visit our sister site
for all the latest securities lending news and analysis
No nation is an island, and the Polish CSD has post-trade services to cater to all of Central and Eastern Europe, says KDPW’s Iwona Sroka
In a region as geographically, culturally and economically diverse as Asia, funds passports have a tricky road ahead if they’re to redefine the industry
Amid cross-border restrictions and tightened belts, Luxembourg’s kingdom of real estate investment won’t be crumbling any time soon
The Chinese market has taken a knock to its confidence, but despite its size, it is still merely an emerging market, and must take these setbacks in its stride
Rich in sunshine, cork hats and tired clichés, Australia’s funds industry doesn’t buck the trend, boasting record levels of assets under custody
As the Saudi Arabian stock exchange finally opens its doors to foreign investments, the influx from abroad will be in baby steps, not leaps and bounds
View country profiles section
The latest features from Asset Servicing Times
Gerard Bermingham and Madhu Ramu of IHS Markit explain how firms can avoid the pitfalls of bad corporate actions data
With the industry in perpetual change, it’s important for firms to work together to take advantage of big data, according to Roy Kirby of SIX
Join Our Newsletter

Sign up today and never
miss the latest news or an issue again

Subscribe now
As technology developments shape the world around them, financial services firms are starting to adapt. This year’s Sibos conference outlined where the industry is settling in, and where there are still milestones to pass
Rocky Martinez considers how AI can help improve post-trade processes, and how SmartStream’s new reconciliations solution is moving a step in the right direction towards helping firms keep costs at sustainable levels
New regulations, new competition and new cost pressures mean custodians and sub-custodians have more balls in the air than ever before
Mark Aldous, head of managed services for Delta Capita, discusses product governance and the need for more cooperation between manufacturers and distributors before the 3 January 2018
The past decade has seen significant change in securities services, but some challenges lead to lessons learnt, says Deutsche Bank’s Satvinder Singh
Artificial intelligence is already a reality in daily life, and it has a place in financial services, says Matt Davey of Societe Generale Securities Services
View features section
The latest interviews from Asset Servicing Times
The UK’s pensions industry is facing challenges from all angles, but KAS Bank’s cost transparency dashboard is here to lend a helping hand, says Pat Sharman
Real Estate Investment Times

Visit our sister site
for all the latest real estate investment news
View interviews section