Banks 3nd quarter ending July 2012
We think it is great that Canadian banks are making money. The alternative is much worse for the Canadian economy and for the Canadian consumer.
How about their customers?
Someone who knew a thing or two about customers, Sam Walton, is quoted as saying: “There is only one boss. The customer. And he/she can fire everybody in the company from the chairman on down, simply by spending his money somewhere else.”
Do you feel that way when you walk into your bank? Banks do have obligations to their customers. They sometimes set these out in their policy or mission statements. Read them if you have an issue with your bank. It you cannot resolve your issue, it is also true that there is Federal legislation that sets out the role and obligation of banks under The Bank Act, you can get more on this at http://laws-lois.justice.gc.ca/eng/regulations/SOR-2003-184/page-1.html.
Should we expect more from our banks than the bare minimum? As Canadians we grew up with Banks prevalent on Main Streets through out this land. Often they were facing each other from across the street. Tellers and managers knew their clients and their clients knew them. That changed with consolidation and automation in the 80’s and 90’s. You have to work to know your bankers now. If you are in business or are thinking about going into business, that might be a good idea.
Are banks in general contributing to the communities that they service? What are they doing…other than paying their taxes to put money back into these communities? We should expect this at the branch level and not just from the Head Office towns (sorry Toronto).
Over the last couple of days the BIG 5 reported their results for the third quarter ending July 31st. Overall the results were good, very good:
Scotiabank profit hits $2.05-billion; hikes payout
BMO profit soars 37%, boosts dividend for first time in 5 years
RBC hikes payout, posts highest-ever quarterly profit of $2.2-billion
CIBC profit jumps 42%, boosts dividend
TD profit rises 14%, increases dividend
Those numbers add up to a whopping 7.7 Billion dollars for the quarter. Congratulations.
Let’s look at them a little more closely. If we say that there are about 35 million people in Canada, including children that would mean that the banks made just over $22 per person in the quarter. That is just over $7 per month. What did you pay in banking fees for the month? We are guessing that it was $7, unless you have some other plan for the banks do have multiple ways of making money.
Three suggestions of what we would like to see more from the banks:
Provide more loans and information for small businesses…we need more of them
Provide busaries and prizes for academic excellenece especially via contests for innovation, design and scientific research to leverage and encourage the building of knowledge based business
Community loan programs to develop infrastructure to build local business – from shopping avenues to innovation or business incubators.
Banks cannot solve all our problems but by leading and showing that “Sharing is Caring,” Banks can help make Canada a better and more competitive place to do business.
So let’s avoid “bank mergers” and let’s encourage Bank growth that is based on a growing , vibrant Canadian economy.