Bank mergers seen as inevitable

Canadian Press AMY CARMICHAEL Wednesday, October 30, 2002

TORONTO — Competition between Canadian banks is increasingly vigorous, customers have more choice and the industry could handle a merger now, industry analysts say.

Consumer advocates say that’s a joke, pointing out that the Big Five banks control 85 per cent of the market and have done nothing to persuade the public that fewer banks would be better. The debate is boiling after a report that Prime Minister Jean Chretien’s office quashed a planned merger between the Bank of Nova Scotia and Bank of Montreal this month.

It was the second time in less than four years that Ottawa had vetoed consolidation in the banking industry, but analysts say it’s only a minor delay and mergers will happen soon.