A pedestrian passes a Silicon Valley Bank Private branch in San Francisco, on March 13.Jeff Chiu/The Associated Press
The Bank and Trust Companies Association is asking Canada’s finance minister to consider raising the insurance limit of account deposits.
The trade group of trusts and smaller banks says in a letter to Chrystia Freeland that the current insured limit of $100,000 is the lowest among G7 nations and doesn’t reflect current financial realities.
The letter, signed by five chief executives including the head of Equitable Bank and Home Trust Co., says the limit doesn’t adequately cover a range of potential cash holders including those saving for a down payment, retirees, newcomers and small businesses.
The group says a higher deposit insurance limit would help level the field of competition in the financial services and create greater stability in the financial system by reducing concerns of deposit losses.
The request comes as recent bank failures in the U.S. have created more focus on the financial backstop measure.
When Silicon Valley Bank failed many of its depositors had cash amounts at the bank that were much higher than the US$250,000 limit, a situation that ultimately led U.S. regulators to extend insurance coverage to all deposits at the bank to avoid a wider banking crisis.