Key facts
- President Donald Trump claimed U.S. banks are not allowed to operate in Canada.
- There are 15 U.S.-based banks operating in Canada, according to the Canadian Bankers Association.
- U.S. banks can operate as Schedule II (subsidiaries) or Schedule III (branches) in Canada.
- Schedule III banks face restrictions, including not accepting deposits below $150,000.
- Eight Canadian banks operate in the U.S., according to Federal Reserve data.
President Donald Trump incorrectly stated that U.S. banks are prohibited from operating in Canada. During a meeting with U.S. travel executives, Trump asserted that Canada does not permit American banks, while its own major banks operate freely in the U.S.
However, data from the Canadian Bankers Association indicates that 15 U.S.-based banks currently operate in Canada, either as branches or subsidiaries, holding approximately $124.6 billion CAD (US$904 million) in combined assets. These institutions offer a range of financial services, including corporate lending, investment banking, and mortgage financing, serving both cross-border clients and the domestic retail market. Major U.S. banks such as J.P. Morgan Chase Bank, Citibank, Bank of America, Capital One, and Wells Fargo have a presence in Canada.
Experts, including finance professor James Thompson and C.D. Howe Institute president Jeremy Kronick, explain that while U.S. banks are permitted to operate, certain regulatory structures can present challenges. U.S. banks in Canada typically operate as Schedule III institutions, which are branches of foreign banks not incorporated in Canada. These branches face restrictions, such as a minimum deposit requirement of $150,000 CAD (US$72,529), making them less accessible for typical retail customers. Schedule II banks, which are Canadian-incorporated subsidiaries of foreign banks, are subject to similar regulations but require separate local capital structures. These regulatory differences and the competitive landscape dominated by large Canadian banks may explain why fewer U.S. banks choose to enter the Canadian market compared to the number of Canadian banks operating in the U.S.