Insight Into Canada's Banking Industry: Canadian Banking Statistics & Facts

It's no secret that Canadians have a love-hate relationship with their banks. On the one hand, we rely on them for everything from everyday transactions to mortgages and loans. On the other hand, we often feel like we're getting ripped off by those pesky bank fees.

Did you know that more than 99% of Canadians have a bank account with a financial institution? Or that the top five banks in Canada hold over six trillion dollars in assets under management? If you're curious about Canada's banking industry, then you'll want to read on. 

In this post, we'll take a look at some interesting Canadian banking statistics and facts. So sit back, relax, and keep on reading!

Canada's Banking Industry Statistics for 2024 - Editor’s Choice

• The banking system in Canada constitutes approximately 3.8% of Canada’s GDP. 
• Canadian banks employ more than 280,000 people.
• Women make up 55.8% of the workforce in the six major Canadian banks.
• 90% of Canadians say that banking has become more convenient due to the deployment of new technologies.
• 65% of Canadians used mobile app banking in the last year.
• In 2020, there were 5,783 bank branches across Canada. 

Interesting Canadian Banking Industry Statistics and Facts

The “Big Five” banks dominate the Canadian banking sector. 

(RBC Global Asset Management)

It’s not a secret that the “Big Five” banks in Canada hold most of the market shares in the financial sector, but only when you put it in perspective does it show you just how much they hold in assets compared to the rest. 

• Total assets of Toronto-Dominion Bank (TD Bank) - 1.73 trillion Canadian dollars in 2021.
• Total assets of Royal Bank of Canada (RBC) - 1.71 trillion Canadian dollars in 2021.
• Total assets of Bank of Nova Scotia (Scotiabank) - 1.18 trillion Canadian dollars in 2021.
• Total assets of Bank of Montreal (BMO) - 988 billion Canadian dollars in 2021.
• Total assets of Canadian Imperial Bank of Commerce (CIBC) - 838 billion Canadian dollars in 2021.

National Bank of Canada is sixth in the total assets list, but there is a huge gap between it and the “Big Five.” The total assets of the National Bank of Canada were 370 billion Canadian dollars as of April 2022. As you can see, Canada’s banking system is pretty centralized, hence the “Big Five” moniker.

You’ll also hear mention of the “Big Six,” and we’ll use it here as well. It includes the “Big Five” plus the National Bank of Canada, which can be considered a regional player at best but is still bigger than most. 

Royal Bank of Canada is the 10th largest bank in the world by market capitalization. 

(Statista)

Market capitalization, often known as stock market value, is the entire worth of a publicly traded company's issued shares.

JPMorgan Chase, with a market capitalization of approximately 468 billion U.S. dollars in 2021, is the largest bank by market capitalization. Bank of America is the only one close to it, with around 364 billion. 

The list includes several Chinese and US banks before it reaches 10th place, where Royal Bank of Canada resides with approximately 151 billion, and Toronto-Dominion Bank closely follows in 11th place with 140 billion. 

The banking system in Canada constitutes approximately 3.8% of Canada’s GDP. 

(Canadian Bankers Association)

The banking system in Canada is exceptionally sound and efficient. In addition, the country has a well-developed infrastructure, which supports the smooth functioning of the banking system.

The sector comprises more than 80 banks, which can be further broken down into four categories: foreign bank subsidiaries, domestic banks, foreign bank branches, and foreign lending branches.

Taxes paid in 2020 by the six largest Canadian banks amount to $12,5 billion. 

(Canadian Bankers Association)

It’s not true that banks only take money from people, even if it sometimes seems so, especially with some banks charging ridiculous fees for pretty much anything. They also, just like anyone else, have to pay taxes, and they also pay dividends to their shareholders. 

The majority of Canadians own shares in Canadian banks, either directly or indirectly, via pension and mutual funds such as the Canada Pension Plan. In 2020, Canadian banks paid out approximately $22 billion in dividends alone.

Canadian banks employ more than 280,000 people.

(Canadian Bankers Association)

In addition to paying taxes, dividends, and directly contributing to GDP, banks employ many people. In fact, banks are among Canada’s largest employers. They also employ over 116,000 people in other countries.

In 2019, banks paid an estimated $30 billion in benefits and wages, with the top six largest banks generating around $1.46 billion in payroll taxes, which included CPP and QPP premiums, Employer Health Tax, and Employment Insurance.

Even if you run a digital business, you will need certain goods for day-to-day operations. The same goes for the banks. The Canadian banking business is a significant buyer of products and services from outside vendors, spending an estimated $21 billion in 2019.

As you can see, banks don’t just sit on a big pile of treasure and hoard it for themselves. A significant amount of money is going back into circulation and further stimulating the economy of Canada. 

Women make up 55.8% of the workforce in the six major Canadian banks.

(Canadian Bankers Association)

In 1995, Canada implemented the Employment Equity Act, which promotes equal opportunity in the workforce. The Act aims to ensure that everyone has an equal opportunity to compete for jobs and advance in their careers, regardless of race, national or ethnic origin, religion, sex, age, mental or physical disability.

Since its implementation, there has been a steady increase in the number of women and visible minorities in the Canadian banking industry. Data for 2020 shows that women now account for 38.5% of senior management jobs and 48.5% of middle management positions, while visible minorities account for 21.2% and 37.2%, respectively. Furthermore, people with disabilities account for 6.3% of the bank's workforce. 

Banks in Canada service 3 million self-employed, small, and medium-sized enterprises.

(Canadian Bankers Association)

Self-employed individuals and small and medium-sized businesses are the backbone of any economy, responsible for creating jobs and driving growth. As of 2020, 7.7 million people in Canada were employed by small-sized businesses. But running a business is not always easy. That's why banks in Canada offer a wide range of products and services to help small businesses succeed. 

Banks offer a variety of products, such as lines of credit and short-term lending options, which can be used for various purposes such as inventory, equipment, or day-to-day operating expenses. Loan acceptance rates for small and medium-sized firms are higher than 89%, and banks have granted more than $255 billion worth of loans as of 2020.

From March 2020 to February 2021, the six largest Canadian banks waived $4.9 million in small business account fees.

(Canadian Bankers Association)

The pandemic was one of the toughest challenges Canada’s economy has faced recently, and Canadian banks stepped up to support their clients. 

Banks worked with the government and Business Development Bank of Canada to offer a series of lending offers and services that helped mitigate some business pandemic-related financial issues. This includes Canada's Emergency Business Account program, which offered over 895,000 loans, amounting to over $48.9 billion in credit.

In addition to waiving fees, banks have implemented easing measures for existing loans in deferrals and term extensions, but what about regular people?

Between March 2020 and February 2021, the six largest banks waived $112 million in fees for personal bank account holders.

(Canadian Bankers Association)

The average person wasn’t left to fend for themselves during the pandemic. The Canadian banking sector also stepped in with fee waving, deferrals, and loan term extensions. Deferrals provided relief to 800,000 Canadians, amounting to a total of $5.5 billion. 

Banks also slashed credit card rates and implemented low minimum payments on credit cards and existing lines of credit. Several banks went a step further by lowering interest rates for those who decided to postpone credit card payments.

Now it remains to be seen if the Canadian banks will do the same if inflation continues to grow and if the recession lingers. 

Between 2017 and 2022, the commercial banking sector in Canada grew by 4.9% each year on average.

(IBISWorld)

Even with the pandemic, the banking sector continued to grow. The market size of commercial banking in Canada in 2022 is estimated to be approximately $230.3 billion. Several factors affect the growth of commercial banking in Canada, including the overnight rate, which the Bank of Canada sets, and aggregate household debt. 

The overnight rate affects how much interest banks can charge on loans. The higher the overnight rate, the higher the interest rates will be. This, in turn, affects how much revenue banks generate from interest on loans. 

Aggregate household debt reflects an economy's demand for personal and consumer borrowing. Banks make more money through interest and origination fees when there is a high demand for such loans. The total amount of household debt is likely to rise in 2022, creating more room for growth.

The vast majority of Canadians have faith in their financial institutions - 86% believe their banks will provide secure digital banking services, and 87% think banks will protect their personal information.

(Canadian Bankers Association)

Canadians have good reason to trust their banks; they have a long history of providing secure and reliable services. Clients can feel confident that their personal information is protected and that their transactions will be processed securely.

Banks have been working hard to ensure that their digital banking services are secure and convenient for customers. They have invested heavily in security systems and processes and have implemented new technologies to ensure that their online and mobile banking platforms are safe and easy to use. In fact, the six largest banks in Canada have invested around $100 billion in technology and security measures over the previous decade.

The majority (90%) of Canadians feel that banking has become more convenient due to the deployment of new technologies.

(Canadian Bankers Association)

Every day, more and more Canadians use digital services provided by their banks. While 89% said they had used internet banking in the previous year, 49% said it was their preferred banking method.

However, even with the increase in digital banking services, 57% of Canadians say they still visit a physical bank branch at least once a year, with 90% being satisfied with in-person banking. The most common reasons for visiting a branch were to deposit or withdraw cash, speak with a banker about a problem, and establish or close an account.

When it comes to ABMs, the most popular services used were checking account balances, transferring money between accounts, and paying bills. The least popular digital banking services were making investments, applying for a loan or credit card, and opening an account.

About 65% of Canadians used mobile app banking in the last year. 

(Canadian Bankers Association)

Digital banking in Canada has been on the rise since the pandemic. This banking method is especially popular among the Gen Z and Millennial generations. This is to be expected given that Millennials account for 33% of Canadian online buyers. 

There are several reasons for the growing popularity of mobile banking. First and foremost, it is convenient. Customers can bank from anywhere at any time. They can also use their mobile devices to track their spending, set up budgets, and manage their finances. 

Another reason people are turning to mobile banking is security. Mobile banking apps use state-of-the-art security features to protect customers' information. They also provide fraud monitoring and detection services. 

Finally, mobile banking apps offer a wide range of features and capabilities. Customers can use them to transfer money, pay bills, deposit cheques, and more.  

Customers are satisfied with both online and app-based banking experiences, with satisfaction levels of 93% and 80%, respectively.

(Canadian Bankers Association)

Though the pandemic has forced many Canadians to bank digitally out of necessity, it seems that the majority (75%) intend to stick with these habits even after things return to normal. This is likely due to the convenience and accessibility of digital banking solutions in Canada.

Not only are Canadians satisfied with digital banking, but an increasing number of them are doing most of their banking digitally. In fact, 78% of Canadians say they use online (49%) and mobile (29%) banking.

In 2020, there were 5,783 bank branches across Canada. 

(Statista)

In recent years, there has been a shift in the way Canadians bank. In 2021, 57% of Canadians used in-branch banking, down from 67% in 2018. At the same time, there was a decrease in Canadian bank numbers from around 5,890 to the current 5,783. 

The decrease in the number of bank branches has been steady since 2014, in fact. The decline of in-branch banking can be attributed to a variety of factors, including pandemic-related safety measures and the increasing technological convenience of online banking. While the traditional brick-and-mortar banking model is changing, banks are still an important part of the Canadian economy.

Canadians have access to approximately 70,000 automated banking machines.

(Canadian Bankers Association)

Of the 70,000 ABMs available throughout Canada, 18,515 are bank-owned. ABMs are a convenient way to conduct your banking transactions, and overall satisfaction with this technology is high. 

Moreover, 20% of Canadians surveyed expected to increase their usage of ABM withdrawals and deposits in the next five years, whereas 16% expected to decrease their reliance on ABMs as other tech-driven alternatives emerge.

Ultimately, with the overall satisfaction of 92% and high usage of ABM banking in Canada, we can safely assume they won’t be going away soon. 

In 2020, 476 million transactions were recorded at bank-owned ABMs in Canada.

(Canadian Bankers Association)

Besides ABM transactions, in 2019, the six largest banks recorded 598 million online banking transactions and 784 million mobile banking transactions.

The big six banks hold 73% of the total residential mortgage debt.

(Canada Mortgage and Housing Corporation)

The banking system in Canada can be seen as a potential financial risk. This could be especially evident if any of the "big six" banks faced financial difficulties. For example, if one of the banks had to sell its mortgages at a discount, the other banks could be forced to do the same, which would reduce the value of all mortgages. This could lead to a credit crunch and a slowdown in the housing market.

The government has introduced some measures to reduce the risks associated with these banks, such as the requirement that they hold more capital. However, it is still important for borrowers to be aware of the risks involved in borrowing from any one of these institutions.

Residential mortgage debt makes up 74% of all household debt in Canada.

(Canadian Bankers Association)

The Canadian banking system is one of the most stable in the world. Despite the high household debt, Canadians are very careful when it comes to borrowing and only borrow when they are certain they can repay the debt - only 0.15% of mortgages are in arrears as of April 2022. 

Purchasing a home can be a great way to increase your net income, but you need to be able to pay off your mortgage in order to keep it. The average price of a single-family home in Montreal, one of Canada's most populous and popular cities to live in, is over $570,000, which may be out of reach for many people.

In five years, 36% of customers expect to use an alternative currency.

(Canadian Bankers Association)

With the rise of digital payment methods, it's no surprise that cryptocurrencies are becoming more popular. A recent poll found that 56% of Canadians would consider using a private cryptocurrency, such as Bitcoin or Ethereum. The main reason cited was convenience (64%).

Conclusion

So, what does this all mean for the average Canadian? 

It means that, overall, the Canadian banking sector is in good shape. We have a healthy mix of large and small institutions, and both are doing well in terms of profitability. The fact that Canadians continue to invest money in their banking system (and especially mortgages) speaks to our faith in the industry.

And finally, while interest rates may be on the rise, they’re still relatively low - so there’s no need to panic! Canada has already overcome pandemics a lot better than most countries, and we’re sure we’ll be able to make it through the current economic turmoil just as well!