no further debate— a fact that reflected both cross-party support in Britain and the sense that the colonies had reached a broad agreement themselves. On March 29, Queen Victoria signed the bill into law, effective July 1.
Macdonald and many of the Canadians were incensed with the indifference shown to the legislation. Canadians would become used to British indifference, except at times of war, as the decades passed.
The Battle of the Bank Acts
The federal government of the new Dominion of Canada now had responsibility for both currency and banking. How they would exercise that responsibility would require specific legislation. Unlike the BNA Act, it proved difficult reaching a consensus, taking three Finance Ministers and nearly four years to pass an act to regulate banking and currency.
Two months after the Dominion was created, the Commercial Bank of the Midland District [ Kingston ] failed. Galt was not only Minister of Finance, but he was also a major shareholder in the bank. He fought to have the Bank of Montreal bail out the Commercial Bank, but he was unsuccessful and was forced to resign the finance portfolio.
Macdonald— by then known as“ Sir John A”— appointed his good friend John Rose, who was closely associated with the Bank of Montreal, the second largest North American bank at the time. His proposed legislation no doubt pleased the Bank of Montreal, but not the House of Commons, so it was left to die on the Order Paper( Parliament’ s daily agenda). Rose was succeeded on October 9, 1869 by Sir Francis Hincks, a former Co-Premier of Canada and Caribbean governor. It was Hincks who placed before Parliament a Bank Act that was acceptable and contained the unique Canadian provision of statutory decennial reviews, meaning every 10 years the act would be re-examined. That legislation was passed on April 14, 1871, and the review provision has done much to enhance the quality of Canadian banking over the decades.
As Roger Martin, former dean of the Rotman Business School and noted author wrote in his book, Where More Is Not Better, this provision should become mandatory for ALL legislation. Why?“ Because there is no such thing as perfection in a complex adaptive world.”
Joe Martin is the president emeritus of the Canadian Business History Association / L’ Association Canadienne pour L’ Histoire des Affaires and coauthor of From Wall Street to Bay Street: The Origins and Evolution of American and Canadian Finance.
Sources
Alexander Hamilton statue in front of the US Treasury building, Washington, DC.
Best, Andrew. Economic Crises in the United Kingdom, the United States and Canada in the 19th Century, Toronto: Rotman School of Management. University of Toronto. 2014.
Browne, G. P. Documents on the Confederation of British North America. McGill Queens University Press. 2009.
Calomiris, Charles W. and Stephen Haber. Fragile by Design: The Political Origins of Banking Crises and Scarce Credit. Princeton University Press. 2015.
Martin, Roger. When More Is Not Better: Overcoming America’ s Obsession with Economic Efficiency. Harvard Business Review Press. 2020.
Shortt, Adam. History of Canadian Currency and Banking, 1600 – 1880. The Canadian Bankers’ Association. 1896( republished in 1986).
Yates, Robert. Notes of the Secret Debates of the Federal Convention of 1787. Taken by the Late Hon Robert Yates, Chief Justice of the State of New York, and One of the Delegates from That State to the Said Convention.
Library of Congress www. MoAF. org | Spring / Summer 2026 | FINANCIAL HISTORY 55