Bank of Canada Week 8

The us federal reserve system duies of the us federal

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Unformatted text preview: rt to commercial banks to bail them out in a Ime of crisis. The Bank of Canada •  Canada followed the BriIsh banking system, with a limited number of larger banks with mulIple branches. •  In the US independent local banks was the norm. •  With our relaIvely small populaIon spread out in rural centres, the BriIsh model made more sense: –  Branch banks required less capital than a full independent bank. The Bank of Canada •  The branch banking system lead for a very stable banking system since the branches spread the risk around the country. •  There was liWle need for a lender of last resort: –  In the US, with its small banks they would oaen find themselves with seasonal cash flow problems, and a central bank (the United States Federal Reserve) was a nece...
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This note was uploaded on 01/26/2014 for the course LAPS ADMS 1010 taught by Professor D.jurkowski during the Winter '10 term at York University.

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