By Joe Martin

In the late 19th century, Adam Shortt, Canada’ s“ first economist,” wrote an article for the Journal of the Canadian Bankers Association in which he concluded,“ The father of the Canadian banking system was Alexander Hamilton, the first Secretary of the Treasury.” In 1957, American historian Bray Hammond drew a similar conclusion in Banks and Politics in America: From the Revolution to the Civil War, and he took it a step further.“ They [ the Canadians ] took the best of American experience for a pattern, and they stuck to it.”

So, was Hamilton the father of Canadian banking? While he was an inspiration

Painting titled Scene at the Signing of the Constitution of the United States, with George Washington, Benjamin Franklin and Alexander Hamilton( left to right in the foreground), by Howard Chandler Christy. to the colonists, many would argue that honor falls to three gentlemen of Scottish origin who came to the colonies at different stages of their lives, but who made lasting contributions.

The first was John A. Macdonald, Canada’ s first Prime Minister, who throughout the lead-up to the passage of imperial legislation had with him a marked-up copy of James Madison’ s secret proceedings of the 1787 Constitutional Convention. The pencil marks show that Macdonald was particularly interested in passages concerning the necessity of a strong central government and the ability of the central government to overrule state decisions.

The second was Alexander Tilloch Galt, who made the quest for unity among the British North American colonies a condition of his joining Macdonald’ s government— a request that included banking and currency being federal, not provincial responsibilities.

The third was Sir Francis Hincks, a former Co-Premier of the Province of Canada, who returned to the country after the British North America( BNA) Act was passed, having served as an imperial governor in the Caribbean. He became Canada’ s third Minister of Finance and was the first to gain Canadian parliamentary approval for a Bank Act that would provide the legislative framework for banking and currency as federal responsibilities.

Shortt’ s and Hammond’ s Positions on Hamilton

Adam Shortt provided several reasons why he believed Canadian banking was derived from Hamiltonian principles, including a 16 clause-by-clause comparison of Hamilton’ s charter of the Bank of the United States and the proposed charter for an 1808 Canadian bank. When the Bank of Montreal was created in 1817, its articles of association were a verbatim copy of the charter of the First Bank of the United States, which further supports Shortt’ s view.

Bray Hammond’ s Banks and Politics in America includes a section on“ Banking in Canada before Confederation, 1792 – 1867.” He notes that the frontier mentality of

52 FINANCIAL HISTORY | Spring / Summer 2026 | www. MoAF. org