Teo Audio wrote:
Canadian banks love foreign money.
when you deposit money in your account, the bank can back $10 worth of loans with your $1 deposit.
With each $1cdn worth of US dollar deposits from out of country..., the bank can loan $100 cdn.
These numbers are not exact, but you get the idea.
The banks will never let you know this thing about foreign money coming in being worth ~10x over normal deposits for loan purposes.
Lets say that my old company (still involved) did $1M in deposits in a year, of US and other foreign moneys coming in.
The bank could use that as backing for as much as...lets say...$50M Canadian in loans, according to the Canadian bank charter they operate under. Under any normal reality this is known as Rehypothecation, but ....
Ken great insight but no....... Canadian banks do not loan $100 for every US 1.00 invested .
Thus a company that brings foreign deposits in is automatically a 'bank darling' that rolls at a seeming minimum weight of 10X-50x its 'foreign-to-Canada' currency deposits.
Just something you might need to know one day when negotiating with a bank.
-- 27 Sep 2017 17:20 --
Teo Audio wrote:
Canadian banks love foreign money.
when you deposit money in your account, the bank can back $10 worth of loans with your $1 deposit.
With each $1cdn worth of US dollar deposits from out of country..., the bank can loan $100 cdn.
These numbers are not exact, but you get the idea.
The banks will never let you know this thing about foreign money coming in being worth ~10x over normal deposits for loan purposes.
Lets say that my old company (still involved) did $1M in deposits in a year, of US and other foreign moneys coming in.
The bank could use that as backing for as much as...lets say...$50M Canadian in loans, according to the Canadian bank charter they operate under. Under any normal reality this is known as Rehypothecation, but ....
Ken great insight but no....... Canadian banks do not loan $100 for every US 1.00 invested .
Thus a company that brings foreign deposits in is automatically a 'bank darling' that rolls at a seeming minimum weight of 10X-50x its 'foreign-to-Canada' currency deposits.
Just something you might need to know one day when negotiating with a bank.
Really..... banks value $100 CDN to $1 US ? Gee I'm should be getting better interest on my US account.