Obama said last week that Canada has shown it is a good manager of its financial system.
"We do have a strong system of regulation and activist regulators who go and meet with the sector," Harper said. "They don't try to micromanage banks' decisions. We try and establish good oversight and transparency."
Canada has avoided the mortgage meltdown and banking crisis that are hitting the United States and Europe hard. Harper said Canada's system of regulation has encouraged "a fairly a cautious culture in the banks."
"For example, our banks when they sign mortgages largely hold those rather than trading them, so they have a lot more interest in the underlying quality of those mortgages," Harper said, adding that Canada has "avoided the subprime mortgage problem."
Harper noted that Canada's big banks aren't as leveraged as their international peers and are actually less leveraged than what they could be under government regulation.
Canada has not experienced the failure of any major financial institution and Canada's banks now have the largest market capitalizations in the world. Royal Bank of Canada has a $27.6 billion market cap compared with Citigroup's much diminished $11.6 billion market cap.
The stock prices of Canada's banks are down but not nearly as much as U.S. or European bank stocks. Canada's financial system is dominated by five banks, unlike in the U.S. where there are scores of banks.
Harper noted that high concentration in the sector.
"We have only six major banks that have most of the market. We only have three major insurance firms and the banks also generally control the brokerages," Harper said.
The World Economic Forum said recently Canada had the most sound financial system in the world, with a rating of 6.8 out of 7.http://seattletimes.nwsource.com/html/businesstechnology/2008777962_apcanadabanksleader.html