Mr. Speaker, I thank the hon. member for his typically erudite intervention. The foreign banks have significant incentives in the Canadian market and there are opportunities. As I mentioned earlier, Wells Fargo in a one year period went from 10,000 customers to 120,000 customers. One of the ways Wells Fargo succeeded or is succeeding in Canada is by lending to small businesses and individuals with fairly wide margins, fairly wide spreads, for instance lending sometimes at prime plus four or five. A lot of small business people can go to a bank and the banks in Canada are reticent to that type of high margin lending because I think part of it is the political stigma of doing it. They do not want to be seen as loan sharks.
For a lot of small business people if they cannot get any capital they will pay a premium to get capital. Wells Fargo has discovered a niche in that area.
The differences between the Canadian banking system and the U.S. banking system have had a real impact on the growth of our economies. I read a study about 12 years ago that compared the concentration of wealth in Canada to the concentration of wealth in the U.S. In the early 1900s in Canada wealth was fairly concentrated with a few families. In the U.S. it was concentrated similarly, the Duponts, the Kelloggs, the Vanderbilts.
Since then in the U.S. wealth has become very much disbursed, whereas in Canada it remains fairly concentrated. This study was basically positing that the Canadian banking system had played a role in that because frankly it is awfully difficult in this country to get capital to grow our business without actually being a part of one of those families or knowing somebody who is or getting a guarantor. Banks are not that entrepreneurial.
I believe there is a significant market in Canada for more entrepreneurial banks if these foreign banks will pursue quite aggressively. I have heard from a number of constituents in small business who have been receiving letters from Wells Fargo. Probably every member of parliament has received letters from MBNA on credit cards. Maybe members of parliament typically do not receive those types of solicitations because we are considered a bad credit risk with no job security and that sort of thing. In any case, I think foreign banks will grow their markets in Canada because they will pursue them aggressively and smartly.