Wal-Mart Canada Corp. has applied to establish a bank, positioning itself to offer new financial products such as credit cards.The Canadian division of U.S. retailing giant Wal-Mart Stores Inc. has filed with Canada's Office of the Superintendent of Financial Institutions for a Canadian bank charter, according to a notice on a Canadian government Web site Friday.
A Wal-Mart Supercentre in Canada, where retailer aims to open a bank.
"By obtaining a banking license, we will be able to provide our customers with great value and convenient financial products and services," said Andrew Pelletier, Wal-Mart Canada's vice president of corporate affairs.
Wal-Mart started a banking business in Mexico this year. Doing so didn't fly in the U.S., where its application for a banking license caused much debate and was withdrawn in March 2007 after almost two years of wrangling with U.S. regional banks, unions and community organizations.
If approved, Wal-Mart Canada Bank will be under the jurisdiction of the OSFI and be subject to the same rules and regulations all Canadian banks follow. It wouldn't be allowed to engage in banking in the U.S.
Banking has become a larger part of Canadian retailing in recent years. Publicly traded mass merchants that have received Canadian bank charters in the past include Loblaw Cos., Canadian Tire Corp., and Sears Canada Inc., which subsequently sold its financial arm to J.P. Morgan Chase & Co.
Wal-Mart Canada Bank doesn't have a final list of services it plans to offer, and it doesn't expect to set up traditional bank branches "for the foreseeable future," Mr. Pelletier said.
"Our initial focus will be offering financial services that are consistent with our business as a retailer, such as credit-card services," he said. He wouldn't speculate about how long the review process may take.
By: Andy Georgiades
Wall Street Journal; September 15, 2008
