Canadian banks are prominently known as steady assets, and many investors place their hard earned savings into equity positions in any one of the "big 6" banks, many believing these assets carry very low risk and very reasonable income over time.
Canadian Imperial Bank of Commerce (TSX:CM)(NYSE:CM), for example, is highly tethered to the Canadian residential mortgage market, something I see of a potential red flag for long-term investors looking to get in at this point in the cycle.
Other banks, like Bank of Nova Scotia (TSX:BNS)(NYSE:BNS) have written off losses related to foreign subsidiaries which have undergone unfavorable audits with regulators in the past.
My top two picks in the Canadian banking sector happen to be Royal Bank of Canada (TSX:RY)(NYSE:RY) and Toronto-Dominion Bank (TSX:TD)(NYSE:TD), specifically for the relative safety and diversification these banks possess.