Undoing a co-operative bargain: The origins and dissolution of federal accommodation of provincial credit unions

The failure of several U.S. regional banks early in 2023 underlined Canada's reputation as home to a resilient banking sector where federal policymakers guard their jurisdictional responsibility over banking against populist impulses and trade off competition for financial stability. This article argues that conventional explanations for this observed stability are incomplete because they omit any discussion of federal policies that shaped the growth of a $550 billion provincially based credit union system. This article reconciles the resulting puzzle by showing how policymakers accommodated credit unions and used them to channel populist impulses but within the bounds of over-arching financial stability concerns.