Schedule I Bank

Schedule I Bank is a Canadian financial institution structure that is regulated under the Federal Bank Act. A Schedule I Bank may not be wholly owned by non-residents.

Bill C-8, implemented on October 24, 2001, replaced the Schedule I and Schedule II bank structures with a new size-based ownership regime. This new regime is based upon an institution's equity.

Institutions with over $5 billion in equity are required to have no person owning more than 20% of the voting shares or 30% of the non-voting shares. Institutions with equity of $1 billion to $5 billion have fewer restrictions on ownership, as they are only subject to having a public float of 35% of voting shares. Institutions with less than $1 billion in equity have no ownership restriction.

Although the Schedule I and II bank structures have been replaced, they are still widely used to describe the two structures of banks in Canada.

In contrast with a Schedule I bank, a foreign Schedule II bank can be owned by non-residents. In addition, a Canadian Schedule II bank is owned by a Schedule I bank and authorized to accept deposits within Canada. Schedule II banks are the most common type of bank in Canada, along with many of the smaller credit unions and trusts. While they are smaller, Schedule II banks are still regulated by the Federal Bank Act.

For many U.S. residents, Canadian banking rules and structures bring to mind the Big Six Banks, which is a term to describe the National Bank of Canada: Royal Bank, the Bank of Montreal, Canadian Imperial Bank of Commerce, the Bank of Nova Scotia (Scotiabank), and Toronto Dominion Bank (TD).

Headquartered in Montreal, the National Bank of Canada is Canada’s sixth largest commercial bank. The Royal Bank of Canada (master brand name RBC) is publicly traded (stock ticker RY on TSX and NYSE); along with its subsidiaries, RBC operates as a diversified financial services company.

The Bank of Montreal (BMO) was established in 1817 and today is also a diversified financial services provider. The total  assets under management (AUM) for BMO as of October 31, 2017 was $710 billion.

The Canadian Imperial Bank of Commerce (CIBC) is headquartered in Toronto, Ontario, and was formed in 1961 through the merger of the Canadian Bank of Commerce and the Imperial Bank of Canada. CIBC today has operations globally and serves more than eleven million clients.

The Bank of Nova Scotia (Scotiabank) is the third-largest Canadian bank by deposits and market capitalization.

Finally, TD Bank Group (consisting of the Toronto-Dominion Bank and its subsidiaries) serves more than 25 million customers worldwide with CDN$1.3 trillion in assets on October 31, 2017 and is one of the top online financial services firms.