Evening star. [volume] (Washington, D.C.) 1854-1972, 1906-08-27
TIE BANKS OF CANADA
THEIn gYsTEN DRFKRs FROM
THAT OF THIS COUNTRY.

The banks Of Canada have played very
important part In the recent interesting
development Of that country's western
provinces American farmers who have
moved Into Canada are loud in their
praises Of the Canadian banking system
in the letters they write to their friends
at home They speak especially Of the
stability and reliability OF the Canadian
banks. Bank failures are rare In Canada,
and when depositor puts his money In q
bank he has little occasion whatever to
worry as to the safety Of his funds.
Another thing that impresses itself on
Americans when FIRST they come into con-
tact with the Canadian banking system
is that the largest deserved credit cs.n be
obtained from one bank. It Ii not neces-
sary for a large business to carry ac-
counts at several banks in order to get
the accommodations required.
The principal differences between tho
Canadian banking system and that Of the
United States are that the Canadians have
nothing to-correspond to our etate banks;
and the chartered banks, which CORE
spond to our national banks, are permit
ted to maintain branches. The result Of
these two differences Is that there are no
small individual banks in Canada, and
the banking business Of the country Is
conducted by comparatively limited
number OF banking corporations, with
branches in every part Of the country.
There are. all told. only "a chartered
banks in Canada, but they have about
1,20O branches in that country and a num-
Der of foreign branches. The existence Of
these great banking institutions, ready at
all times to establish new branches or 10
cal banks in every town that develops or
promises to develop business, Is Of great
help In opening up new country because
1T provides. before'an isolated community
could provide for itself, an agency that
performs the functions of banking-which
are in even greater need in q Few country
than elsewhere.
Bankers generally agree that the Cana
dian bank currency Is superior to ours,
particularly with respect to utility. The
chartered banks have the power to issue
bank notes to an amount not exceeding
their pafd-up capital. These notes consti-
tute practically the entire medium of ex-
change of the country outside Of limit
ed amount of dominion government paper
currency and some subsidiary coin. The
banks naturally put out a greater volume
Of these notes or bills when there is u
great demand for money. In other words,
the Canadian system has that elasticity
that the ffnanciers Of this country have
been saying for years Is the chief defect
In our own system-a defect which has,
however. not been remedied.
Although, like our national banks, the
chartered banks OF Canada are not per-
mftted to lend money on real estate. any
farmer who Is making a success may cas-
lily secure a reasonable loan on his per-
sonal note. As the banks have branches
all over the country, they have q most ef-
ficfent means Of transmitting unused
capital from one region to appetizer where
there is g. demand for 1t. In this way the
surplus capital OF eastern Canada IL tr ana
ferred and used in the west with q mini
mum of friction and also minimum Of
cost to the borrower. The newest town In
western Canada thus has as easy access
to the capital required for its develop
ment as the oldest town in the east. In
Canadian banking system there have
never been in the west Of Canada any
such usurfous practices az have SO often
burdened the agricultural classes OF the
western states,