Canada's big five banks - Royal Bank of (NYSE: BNS - News) Canada (NYSE: RY - News) , Toronto-Dominion, Scotiabank, Canadian Imperial Bank of Commerce (NYSE: BCM - News) and Bank of Montreal (NYSE: BMO - News) - have not been immune to the turmoil in global banking.

Several, if not all, will announce big writedowns this week as part of their results for the fiscal year ended October 31. Bank of Montreal, which reported last Tuesday, tripled fourth-quarter loan loss provisions to C$465m ($376m).

Scotiabank has disclosed that it will take a pre-tax charge of C$890m, well above analysts' estimates, on its structured finance and trading businesses. Toronto-Dominion has announced C$350m in after-tax losses on corporate debt securities and related credit default swaps.

Moody's is now reviewing TD's triple A credit rating. "Its risk positioning may have weakened," the ratings agency said.

The five banks' shares are trading at a generous average dividend yield of more than 6 per cent, suggesting concern that at least some - notably CIBC and Bank of Montreal - may be forced to pare their pay-outs. Bank of Montreal has paid dividends without interruption since 1829.

Even so, the Canadian banks are the envy of many rivals elsewhere. The World Economic Forum recently ranked Canada as the soundest banking system in the world, ahead of Sweden, Luxembourg and Australia.

The Canadian banks have the advantage of vast and stable retail networks, and have taken a more conservative approach to lending than their US counterparts. The subprime mortgage market is minuscule.

They have bolstered their capital with large issues of preferred shares and subordinated debt. On the governance side, all five have separated the jobs of chairman and chief executive.

"Without wanting to appear arrogant or vain, which would be quite un-Canadian . . . while our system is not perfect, it has worked during this difficult time," Jim Flaherty, finance minister, told the Financial Times in a recent interview.

Government support has so far consisted mainly of improving the banks' liquidity by agreeing to buy $75bn of high-quality mortgages. It has also raised the limit for preferred shares that qualify as tier one capital.

Taxpayers have not coughed up a cent so far."I don't want the government to be in the banking business in Canada," Mr Flaherty says.

It was not the government but the five banks plus National Bank of Canada, a smaller Quebec-based institution, that lent a helping hand earlier this month to Manulife Financial, one of North America's biggest insurance groups. The six have lent Manulife $3bn to shore up units that have suffered investment losses.

Several potential minefields remain. One is the banks' exposure to private equity buy-outs.

Andre-Philippe Hardy, analyst at RBC Capital Markets, recently lowered his forecasts for the banks' 2009 earnings.

Mr Flaherty gave notice last Thursday that the government would amend banking legislation to allow it to inject capital into troubled financial institutions.