Laurentian Bank is to be broken up and sold in pieces to National Bank of Canada and Fairstone Bank of Canada.Christinne Muschi/The Canadian Press

John Turley-Ewart is a contributing columnist for The Globe and Mail, a regulatory compliance consultant and a Canadian banking historian.

Canada is no country for small banks. And this year is full of reminders, with 179-year-old Laurentian Bank of Canada announcing this month that it will be broken up and sold in pieces to National Bank of Canada and Fairstone Bank of Canada.

Its stay-small strategy didn’t pay. Eric Provost, the Montreal-based bank’s CEO, admitted as much in a recent call with analysts: “The substantial investments needed to sustain a competitive position in the Canadian banking landscape, coupled with the evolving regulatory requirements and rising customer expectations, have made it increasingly difficult to compete.”

President’s Choice Bank, owned by Loblaw Cos. Ltd., has tapped out as well and will merge with EQ Bank. In March, the all-digital Motus Bank was shuttered. The month before, National Bank closed its acquisition of Canadian Western Bank. For Fairstone and EQ Bank the deals are wins. They give both more banking bulk.

Yet these mergers suggest that what Canada needs isn’t more banks, but........

© The Globe and Mail