10.05.2011
By Terry Flanagan

Toronto Wields Financial Clout

TSX takeover triggers strong sentiments among financial community.

The failed acquisition of the Toronto Stock Exchange by the London Stock Exchange underscores a sentiment that Toronto is emerging as a world financial center in its own right.

The future of Toronto’s TMX Group, operators of the Toronto Stock Exchange and the TSX-Venture Exchange, is up in the air as its proposed merger with the London Stock Exchange Group has foundered.

“Much of the debate around the proposed TMX-LSE merger was centered around the fact that Toronto is a growing hub, and would this merger facilitate that growth?” Janet Ecker, president of the Toronto Financial Services Alliance, told Markets Media.

A competing proposal to acquire TMX had been advanced by Maple Group Acquisition Corp., a consortium led by some of Canada’s largest banks and pension and investment funds.

“Most agree that an important goal is to preserve Toronto’s leadership position in mining
and metals financing and listings,” said Ecker.

The fact that Canada weathered the financial crisis relatively unscathed is testament to the soundness of the credit policies of leading financial institutions in the region.

“What was considered a weakness is now considered a strength, which is a conservative approach to risk management,” Ecker said. “Minister Flaherty [Federal Finance Minister Jim Flaherty] says ‘stodgy is the new sexy.’”

While the capital markets landscape in Canada is reshaped by regulatory reform, the shape of those reforms is characterized by a willingness of industry and regulators to seek common ground.

“As we seek to improve regulations, it’s important that we don’t end up undermining the strength  of the financial sector as an economic driver,” Ecker said.  “The strength of Canada lie in  the relationships between policymakers, regulators and the financial sector; there’s a spirit of working together to find resolutions, which we’re not seeing in other jurisdictions.”

Related articles

  1. S3 Launches Canada Best-Execution Suite

    Canadian Depositary Receipts provide investors with access to foreign stocks with mitigated currency risk.

  2. TMX Aims to Keep Retail Flow in Canada

    Canadian launch will be MATCHNow’s first product launch under the Cboe umbrella.

  3. From The Markets

    Torstone Expands In Canada

    A new Toronto office will support the technology firm's expansion in North American.

  4. S3 Launches Canada Best-Execution Suite

    Tech vendor will support Canadian equities trading and interlisted securities trading via its AMS.

  5. The new offering will consolidate and distribute Canadian OTC bond and derivatives data.