Summary:
With an amazing competitive market out there, American consumers and business customers are losing their trust in the American banks of United States. They are feeling a sense of concern for their own banks and decide to open newly admitted accounts in Canadian-owned banks, instead. Apparently, Americans believe in Canada's strong financial shapes compared with the United States. This opportunity leads Canadian Banks with a more diversified customer environment. Royal Bank RBC, BMO Bank of Montreal, and TD Canada Trust wants to take a surge in bank deposits, demand for loans, and other banking options. However, customers are already swarming these banks for a safer financial system compared with the American banks.
Connection:
This chapter deeply resides with the cash flow statements and how relevant cash flow is to businesses, no matter whether they are huge corporations or small businesses. As for the banks, they are constantly seeking for "Line of Credits" to issue to customers. This loan arrangement is beneficial to banks because it requires such a high interest rate for customers. It is significant to families with financial needs to have access to a bit more cash to maintain their family's financial position. These normal day-to-day operating activities within a bank may also accumulate profit as the cash flow statements are being completed for the fiscal period.
Reflection:
Many companies are desperate into maintaining their financial positions during this time of the year - the recession. However, there are many who fail in achieving their goals as they struggle to make decisions on enhancing their company's finances. American banks are no exception. Customers from the United States are loosing their trust for their nation's local banks and walking away from them. This leads Canadian banks with great benefits from this financial crisis. Also, this leaves American banks out of control as they are continuously losing customers due to the unhealthy U.S. financial system. In other words, this kind of causes the U.S. with a massive destruction of economic recession without any other paths to reconsider.
