A top Bank of Canada official last week called for increased competition in the country’s banking sector, arguing it would boost productivity and benefit consumers rather than imposing additional regulations.
Senior Deputy Governor Carolyn Rogers delivered the remarks at the Canadian Club in Toronto, explicitly describing Canada’s financial sector as an oligopoly dominated by the Big Six banks.
“Greater contestability, more new entrants and more innovation in our financial sector would lead to competition that’s good for consumers, for productivity and for our economy,” Rogers said. “We should lean into it.”
The speech builds on Rogers’ earlier warnings about Canada’s productivity crisis, which she previously called “an emergency.” She argued the issue has become more urgent amid ongoing trade tensions with the United States.
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Rogers acknowledged that the dominance of Canada’s major banks has provided financial sector stability and made institutions less likely to take major risks with customer funds. However, she emphasized the need to balance safety with innovation and growth.
She pointed to open banking frameworks — which would give consumers greater control over their financial data and make switching banks easier — as one pathway to increase competition. Rogers also highlighted plans for a real-time payments system that would allow smaller firms to bypass big banks as middlemen, which could boost competition.
According to Rogers, 69% of Canadians haven’t switched their primary bank in the past decade, and 29% have never changed banks.
The remarks contrast with positions taken by major Canadian banks. National Bank CEO Laurent Ferreira said earlier this year that an oligopoly is “actually a good thing” because it facilitates coordination during crises, while Royal Bank CEO Dave McKay has described Canada’s banking system as “ruthlessly competitive.”
The Canadian Bankers Association maintains that Canada’s banks operate in a highly competitive marketplace and has called for increased regulation of financial technology companies, arguing that regulators have left fintechs largely unregulated, which poses risks to the financial system.
Canada’s Big Six banks collectively hold approximately 93% of all banking assets in the country.
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