Canada's First Bank, the Bank of Montreal, Was Modeled After the Second Bank of the United States

Canadian bank charters, if not other aspects of the banking system, were modelled explicitly on American examples, a fact that is emphasized by W.T. Easterbrook and Hugh G.J. Aitken in Canadian Economic History. The first Bank of the United States, based on principles enunciated by Alexander Hamilton, served as the model for the stillborn Bank of Lower Canada in 1808. The articles of association that led to the charter of the Bank of Montreal also followed American examples, particularly that of the second Bank of the United States, which began operation only six months before the Bank of Montreal. The latter bank sent its officers to New York to study banking procedures in effect there, and it employed experienced American bankers during its early years. Easterbrook and Aitken saw strong parallels between the centralist organization, branch systems, and uniform stable currency of Hamiltonian principles, and the legislative framework of Canadian banking. Some nineteenth century opinion supports this view. In 1877 Sir Francis Hincks offered the generalization that the Canadian banking system was modelled on the one that formerly prevailed in the United States. He was referring to the first and second Banks of the United States and their branch systems.

—Stephen Edward Thorning, “Hayseed Capitalists: Private Bankers in Ontario” (PhD diss., McMaster University, 1994), 25.