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An Act to amend the law governing financial institutions and to provide for related and consequential matters (S.C. 2007, c. 6)

Assented to 2007-03-29

Marginal note:1992, c. 26, s. 7

405. Subsections 18(3) and (4) of the Act are replaced by the following:

  • Marginal note:Contents of policy

    (3) The policy of deposit insurance shall consist of the provisions that may be prescribed by the by-laws.

  • Marginal note:Policies deemed to be amended

    (4) If a by-law respecting the content of the policy of deposit insurance is amended, or revoked and replaced, every policy of deposit insurance is deemed to be amended or replaced accordingly.

Marginal note:1996, c. 6, s. 27

406. Subsection 21(5) of the Act is replaced by the following:

  • Marginal note:Calculation of deposits

    (5) For the purposes of this section, a member institution may use any method approved by the Corporation to determine or estimate the aggregate amount of its deposits that are considered to be insured by the Corporation.

Marginal note:R.S., c. 18 (3rd Supp.), s. 58

407. Subsection 23(2) of the Act is replaced by the following:

  • Marginal note:Payment of first premium

    (2) Despite subsection 22(2), the premium payable by a member institution under subsection (1) must be paid to the Corporation, without interest, within 30 days after the end of the month in which the member institution becomes a member institution.

Marginal note:R.S., c. 18 (3rd Supp.), s. 59

408. Paragraph 25.1(1)(b) of the Act is replaced by the following:

  • (b) giving the member institution an opportunity to make written representations,

Marginal note:1997, c. 15, s. 114

409. The heading before section 26.01 of the Act is replaced by the following:

FEDERAL INSTITUTIONS WITHOUT DEPOSIT INSURANCE
Marginal note:1997, c. 15, s. 114

410. Section 26.02 of the Act is replaced by the following:

Marginal note:Application

26.02 If a federal member institution intends to accept deposits payable in Canada while no longer being a member institution, it must apply to the Corporation for an authorization to do so. The application must be in a form that is acceptable to the Corporation and must contain the information that the Corporation may require.

Marginal note:1997, c. 15, s. 114; 1999, c. 28, s. 102

411. Paragraphs 26.03(1)(b) to (e) of the Act are replaced by the following:

  • (b) the sum of all the deposits held by the federal member institution that are less than $150,000 and payable in Canada is less than one per cent of the sum of all the deposits held by the institution that are payable in Canada;

  • (c) the institution has informed all its depositors, in accordance with any rules that may be prescribed by the by-laws,

    • (i) that the institution has applied to become authorized to accept deposits while no longer being a member institution,

    • (ii) that after the institution receives that authorization, no deposit with the institution will be insured in whole or in part by the Corporation, and

    • (iii) that the institution’s obligation to repay the deposit to the depositor will be assumed by a member institution if an option referred to in subparagraph (d)(i) or (ii) is not exercised;

  • (d) in respect of each deposit that is held by the institution, the institution has

    • (i) obtained from the depositor an acknowledgement in writing that the deposit will no longer be insured in whole or in part by the Corporation after the institution receives authorization to accept deposits without being a member institution,

    • (ii) at the request in writing of the depositor, paid to the depositor the principal amount of the deposit and interest determined in accordance with rules prescribed by the by-laws and has not charged any fee or penalty in connection with the payment, or

    • (iii) obtained from a member institution an agreement in writing to assume the institution’s liability in relation to the deposit on the same terms and conditions; and

  • (e) the institution has paid to the Corporation a fee determined in accordance with rules prescribed by the by-laws.

Marginal note:1997, c. 15, s. 114

  • 412. (1) Subsection 26.04(1) of the Act is replaced by the following:

    Marginal note:Minister and Superintendent to be informed

    • 26.04 (1) Before giving an authorization under subsection 26.03(1), the Corporation must inform the Minister and the Superintendent that it proposes to give the authorization.

  • Marginal note:1999, c. 28, s. 103

    (2) Subsection 26.04(3) of the Act is replaced by the following:

    • Marginal note:Authorization after 30 days

      (3) If the Minister does not issue that direction within those 30 days, the Corporation may then give the authorization under subsection 26.03(1). The giving of the authorization cancels the policy of deposit insurance of the federal member institution to which the authorization is given.

    • Marginal note:Amendment of order

      (4) If the Corporation gives the authorization under subsection 26.03(1), the Superintendent must, under paragraph 54(1)(a) of the Bank Act, paragraph 62(1)(a) of the Cooperative Credit Associations Act or paragraph 58(1)(b) of the Trust and Loan Companies Act, as the case may be, amend the federal member institution’s order approving the commencement and carrying on of business accordingly.

Marginal note:1997, c. 15, s. 114

413. Section 26.06 of the Act is replaced by the following:

Marginal note:Deposits not insured

26.06 After a federal member institution has been given authorization under subsection 26.03(1), no deposit with the institution is insured in whole or in part by the Corporation.

Marginal note:R.S., c. 18 (3rd Supp.), s. 62; 1996, c. 6, s. 41

  • 414. (1) Subsection 31.1(1) of the English version of the Act is replaced by the following:

    Marginal note:Acceleration of termination of policy of deposit insurance

    • 31.1 (1) Despite any other provision of this Act, if, at any time after a notice of termination has been given to a provincial member institution under subsection 31(1), the Corporation concludes that

      • (a) the financial condition of the provincial member institution has deteriorated since the giving of the notice, and

      • (b) the interests of depositors will be adversely affected by any further delay in terminating the provincial member institution’s policy of deposit insurance,

      the Corporation shall without delay send a notice by registered mail, or deliver a notice by hand, to the provincial member institution and to the appropriate provincial Minister, to the effect that the policy of deposit insurance of the institution will be terminated on the expiration of a period of five days after the receipt of the notice by the institution.

  • Marginal note:R.S., c. 18 (3rd Supp.), s. 62

    (2) Subsections 31.1(2) and (3) of the Act are replaced by the following:

    • Marginal note:Revocation

      (2) The Board of Directors of the Corporation or one of its committees established for the purpose may, before the expiry of the period specified in the notice, revoke the notice if, after considering any written representations made by the provincial member institution, it is satisfied that it is appropriate to do so.

Marginal note:R.S., c. 18 (3rd Supp.), s. 62; 1996, c. 6, s. 38

415. Section 33 of the Act is replaced by the following:

Marginal note:Cancellation

  • 33. (1) Subject to subsection (3), the policy of deposit insurance of a member institution may be cancelled by the Corporation if, in the opinion of the Corporation, the member institution

    • (a) is or is about to become insolvent; or

    • (b) has ceased to accept deposits.

  • Marginal note:Cancellation

    (2) If a member institution intends to cease to accept deposits, it must notify the Corporation and the institution’s policy of deposit insurance may, subject to subsection (3), be cancelled by the Corporation.

  • Marginal note:No cancellation in certain cases

    (3) The Corporation shall notify the Minister and the Superintendent of the action it is proposing to take under subsection (1) or (2) and it shall not take the action if it is advised by the Minister that in the opinion of the Minister taking the action would not be in the public interest.

Marginal note:1996, c. 6, s. 39

  • 416. (1) Subsection 34(1) of the Act is replaced by the following:

    Marginal note:Effect of termination or cancellation

    • 34. (1) If the policy of deposit insurance of a member institution is terminated or cancelled by the Corporation, the deposits with the institution on the day the termination or cancellation takes effect, less any withdrawals from those deposits, continue to be insured under the terminated or cancelled policy of deposit insurance for a period of two years or, in the case of a term deposit with a remaining term exceeding two years, to the maturity of the term deposit.

  • (2) Section 34 of the Act is amended by adding the following after subsection (4):

    • Marginal note:Amendment of order

      (5) If the policy of deposit insurance of a federal member institution is cancelled by the Corporation under paragraph 33(1)(b) or subsection 33(2), the Superintendent must, under paragraph 54(1)(a) of the Bank Act, paragraph 62(1)(a) of the Cooperative Credit Associations Act or paragraph 58(1)(b) of the Trust and Loan Companies Act, as the case may be, amend the federal member institution’s order approving the commencement and carrying on of business to prohibit the institution from accepting deposits in Canada.

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