Magazine article American Banker

Bankers Trust Scores with Canada Clearing Venture

Magazine article American Banker

Bankers Trust Scores with Canada Clearing Venture

Article excerpt

Bankers Trust New York Corp. says a Canadian check clearing and settlement venture it established in January has garnered 70% of the market for "southbound" transactions.

The venture clears checks denominated in U.S. dollars for Canada's largest banks through a processing site in suburban Toronto.

The operation, a division of BT Canada, handles 25,000 items worth $200 million on an average night.

"We've never been a bank known for its lightning strikes," said Alexander P. McKown, vice president at Bankers Trust. "But we went to Canada and in a few months took a market away."

Toronto-Dominion Bank, Canadian Imperial Bank of Commerce, Bank of Nova Scotia, Bank of Montreal, and Royal Bank of Canada have agreed to use the Bankers Trust site to settle at least a portion of their U.S.-dollar checks drawn on U.S. banks, said Bankers Trust officials.

Bankers Trust already is a big player in the international check- clearing business. According to bank executives, it holds 38% of the market for international cash letters, clearing nearly 300,000 items daily for overseas correspondents through a site in Totowa, N.J.

"This is our niche," said Donald F. Schule, vice president in the bank's processing subsidiary, Global Processing Services.

For years the group jealously watched an upstate New York rival - Marine Midland Banks Inc. - enjoy a commanding presence in the Canadian market by virtue of geography. It was easier for Toronto-based banks to messenger U. …

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