The Canadian banking industry has had quite a run. Not a single bank has failed in over 20 years, and the largest banks have paid stable or higher dividends for more than a century: Royal Bank of Canada (RY): since 1870Canadian Imperial Bank of Commerce (CM): since 1868Toronto-Dominion Bank (TD): since 1857Scotiabank (BNS): since 1833Bank of Montreal (BMO): since 1829 Compared to their American counterparts, Canadian banks sailed through the 2008 housing crash (see below) and have arguably not faced a major downturn in the credit cycle for at least a couple of decades.

The Canadian banking industry has had quite a run. Not a single bank has failed in over 20 years, and the largest banks have paid stable or higher dividends for more than a century: Royal Bank of Canada (RY): since 1870Canadian Imperial Bank of Commerce (CM): since 1868Toronto-Dominion Bank (TD): since 1857Scotiabank (BNS): since 1833Bank of Montreal (BMO): since 1829 Compared to their American counterparts, Canadian banks sailed through the 2008 housing crash (see below) and have arguably not faced a major downturn in the credit cycle for at least a couple of decades.

The Canadian banking industry has had quite a run. Not a single bank has failed in over 20 years, and the largest banks have paid stable or higher dividends for more than a century: Royal Bank of Canada (RY): since 1870Canadian Imperial Bank of Commerce (CM): since 1868Toronto-Dominion Bank (TD): since 1857Scotiabank (BNS): since 1833Bank of Montreal (BMO): since 1829 Compared to their American counterparts, Canadian banks sailed through the 2008 housing crash (see below) and have arguably not faced a major downturn in the credit cycle for at least a couple of decades.

America's banks have come a long ways since the 2007-09 financial crisis. They are generally much better capitalized and have sizable capital buffers to absorb losses from unexpected shocks. For example, the Fed's 2019 stress test on the nation's largest and most complex banks indicated that these institutions could maintain adequate capital levels, as well as their dividends, in "severely adverse" economic conditions. However, the coronavirus pandemic is a test unlike any other for banks. Interest rates have plunged, the potential for widespread credit losses has jumped, and political pressure is mounting for banks to free up more capital for their communities rather than reward shareholders with distributions.