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Bill Radke: As financial turmoil shakes the globe, the World Economic Forum has released a survey rating global banking systems, and as Marketplace’s Jennifer Collins reports, you don’t have to look too far to find the world’s soundest banks.
Jennifer Collins: In fact, all you have to do is run for the border — the northern border. According to the survey, Canada has the strongest banking system in the world. The World Economic Forum polls business execs and then ranks the banking systems of a 134 countries. The U.S.’ failed banks and massive bailouts didn’t do much to inspire confidence in our system. Our country’s banks came in at number 40 on the list below Estonia and Namibia. Christopher Thornberg, is a principal at Becon economics, and he says American banks just borrowed way too much.
Christopher Thornberg: All of these banks leveraged themselves up to levels that they’ve never been at before and that’s certainly what got them in trouble and what makes our banks look so delicate.
Thornberg says Canada may not maintain its perch for long. The country has been dragged down by the struggling U.S. dollar.
Thornberg: You know, I never really thought of Canada as a financial capital of the world.
For the time being though, Canada shares the top five safest banking systems with Sweden, Luxembourg, Australia and Denmark.
I’m Jennifer Collins for Marketplace.
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