No. of Recommendations: 2
Therefore all the majority shareholders have a vested interest in avoiding competition between all four banks. Which accounts for the IMF announcement that the Australian banks were the most profitable in the world.


Scheesch and I thought ours were an oligopoly!!!!!

That cannot be good for the customers?


Banking regulation

The new framework includes revised ownership rules for banks and a new size-based ownership regime. Under the previous framework, a distinction was drawn between Schedule I and Schedule II banks (see Annex 1 for a list of these banks). Shares of Schedule I banks were required to be widely held, with no single shareholder or group of shareholders holding more than 10 per cent of any class of shares, while Schedule II banks could be owned by eligible Canadian or foreign financial institutions.

Under the new legislation an individual investor will now be permitted to own up to 20 per cent of any class of voting shares of a widely held bank and up to 30 per cent of any class of non-voting shares, subject only to a “fit and proper” test designed to evaluate the applicant’s character and suitability. This will allow widely held banks to enter into strategic alliances and joint ventures involving significant share exchanges. At the same time, the Bank Act will continue to prohibit control of a large financial institution by any single shareholder or group of shareholders. The Government has signalled its intention to issue guidelines that will clarify for investors and institutions the factual criteria and policy objectives to be taken into consideration in assessing control. The Government will be developing these guidelines in consultation with representatives of financial institutions and the broader investment community.
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