Bank of Canada Act (R.S.C., 1985, c. B-2)

Act current to 2017-11-20 and last amended on 2016-12-15. Previous Versions

Government Directive

Marginal note:Consultations
  •  (1) The Minister and the Governor shall consult regularly on monetary policy and on its relation to general economic policy.

  • Marginal note:Minister’s directive

    (2) If, notwithstanding the consultations provided for in subsection (1), there should emerge a difference of opinion between the Minister and the Bank concerning the monetary policy to be followed, the Minister may, after consultation with the Governor and with the approval of the Governor in Council, give to the Governor a written directive concerning monetary policy, in specific terms and applicable for a specified period, and the Bank shall comply with that directive.

  • Marginal note:Publication and report

    (3) A directive given under this section shall be published forthwith in the Canada Gazette and shall be laid before Parliament within fifteen days after the giving thereof, or, if Parliament is not then sitting, on any of the first fifteen days next thereafter that either House of Parliament is sitting.

  • R.S., c. B-2, s. 14.

Bank Staff

Marginal note:Officers and employees
  •  (1) Such officers and employees may be employed as in the opinion of the Executive Committee may be necessary.

  • Marginal note:Pension fund

    (2) The Board may by by-law establish a pension fund for the officers and employees of the Bank and their dependants and may contribute to it out of the funds of the Bank. The pension fund shall be invested in such manner as may be provided by the by-laws of the Bank.

  • Marginal note:By-laws respecting Governor and Deputy Governor

    (3) A by-law made under subsection (2) that provides for or relates to the payment of a pension in respect of the retirement of the Governor or Deputy Governor otherwise than by reason of age or disability does not take effect unless it is approved by the Governor in Council.

  • R.S., 1985, c. B-2, s. 15;
  • 1997, c. 15, s. 96(E).

Secrecy

Marginal note:Oath of directors and staff

 Before a person starts to act as a director, an officer or an employee of the Bank, he or she shall take an oath, or make a solemn affirmation, of fidelity and secrecy, in the form set out in the schedule, before a commissioner for taking affidavits.

  • R.S., 1985, c. B-2, s. 16;
  • 1997, c. 15, s. 97;
  • 2001, c. 9, s. 193.

Capital and Shares

Marginal note:Capital
  •  (1) The capital of the Bank shall be five million dollars but may be increased from time to time pursuant to a resolution passed by the Board of Directors and approved by the Governor in Council and by Parliament.

  • Marginal note:Shares

    (2) The capital shall be divided into one hundred thousand shares of the par value of fifty dollars each, which shall be issued to the Minister to be held by the Minister on behalf of Her Majesty in right of Canada.

  • Marginal note:Registration

    (3) The shares issued to the Minister shall be registered by the Bank in the name of the Minister in the books of the Bank at Ottawa.

  • R.S., c. B-2, s. 17.

Business and Powers of the Bank

Marginal note:Powers and business

 The Bank may

  • (a) buy and sell gold, silver, nickel and bronze coin or any other coin and gold and silver bullion;

  • (b) buy and sell foreign currencies and maintain deposit accounts with banks or foreign banks, either in or outside Canada, to facilitate such operations;

  • (c) buy and sell securities issued or guaranteed by Canada or any province;

  • (d) buy and sell securities issued or guaranteed by the Government of the United States of America or Japan or the government of a country in the European Union;

  • (e) [Repealed, 2001, c. 9, s. 194]

  • (f) buy and sell special drawing rights issued by the International Monetary Fund;

  • (g) for the purposes of conducting monetary policy or promoting the stability of the Canadian financial system,

    • (i) buy and sell from or to any person securities and any other financial instruments — other than instruments that evidence an ownership interest or right in or to an entity — that comply with the policy established by the Governor under subsection 18.1(1), and

    • (ii) if the Governor is of the opinion that there is a severe and unusual stress on a financial market or the financial system, buy and sell from or to any person any securities and any other financial instruments, to the extent determined necessary by the Governor;

  • (g.1) [Repealed, 2008, c. 28, s. 146]

  • (h) make loans or advances for periods not exceeding six months to members of the Canadian Payments Association on taking security in any property that the institution to which the loan or advance is made is authorized to hold;

  • (i) make loans or advances for periods not exceeding six months to the Government of Canada or the government of a province on taking security in readily marketable securities issued or guaranteed by Canada or any province;

  • (j) make loans to the Government of Canada or the government of any province, but such loans outstanding at any one time shall not, in the case of the Government of Canada, exceed one-third of the estimated revenue of the Government of Canada for its fiscal year, and shall not, in the case of a provincial government, exceed one-fourth of that government’s estimated revenue for its fiscal year, and such loans shall be repaid before the end of the first quarter after the end of the fiscal year of the government that has contracted the loan;

  • (k) [Repealed, 2008, c. 28, s. 146]

  • (l) accept deposits from the Government of Canada and pay interest on those deposits;

  • (l.1) accept deposits from any bank, authorized foreign bank that is not subject to the restrictions and requirements referred to in subsection 524(2) of the Bank Act or other member of the Canadian Payments Association;

  • (l.2) pay interest on the deposits referred to in paragraph (l.1) if the money deposited is to be used for the purpose of making loans or advances referred to in paragraph (h);

  • (l.3) accept deposits from the government of any province or from any corporation or agency of the Government of Canada;

  • (m) open accounts in a central bank in any other country or in the Bank for International Settlements, accept deposits from central banks in other countries, the Bank for International Settlements, the International Monetary Fund, the International Bank for Reconstruction and Development and any other official international financial organization, act as agent or mandatary, or depository or correspondent for any of those banks or organizations, and pay interest on any of those deposits;

  • (m.1) act as a custodian of the financial assets of the Canada Deposit Insurance Corporation and of those of the Canada Mortgage and Housing Corporation;

  • (n) acquire, hold, lease or dispose of real property or immovables;

  • (o) accept deposits of money that are authorized or required by an Act of Parliament to be transferred to the Bank, and, in accordance with that Act, pay interest on money so deposited and pay out money to any person entitled to it under that Act; and

  • (p) carry on any business activity that is incidental to or consequential on something the Bank is allowed or required to do by this Act.

  • R.S., 1985, c. B-2, s. 18;
  • 1992, c. 1, s. 142;
  • 1997, c. 15, s. 98;
  • 1999, c. 28, s. 95;
  • 2001, c. 4, s. 58, c. 9, s. 194;
  • 2004, c. 25, s. 6(E);
  • 2008, c. 28, s. 146;
  • 2014, c. 20, s. 108;
  • 2016, c. 12, s. 123.
Marginal note:Policy established by Governor
  •  (1) The Governor shall establish a policy for the purposes of subparagraph 18(g)(i).

  • Marginal note:Publication

    (2) The Bank shall publish the policy and any amendment to it in the Canada Gazette and the policy or the amendment comes into force seven days after the day on which the Bank publishes it or on any later day specified by the Governor.

  • 2008, c. 28, s. 147.
Marginal note:Publication

 If the Bank takes any action under subparagraph 18(g)(ii), the Bank shall cause a notice to be published in the Canada Gazette that the Governor has formed an opinion that there is a severe and unusual stress on a financial market or the financial system. The notice is to be published as soon as the Governor is of the opinion that its publication will not materially contribute to the stress to which the notice relates.

  • R.S., 1985, c. B-2, s. 19;
  • 1991, c. 46, s. 581;
  • 1997, c. 15, s. 99;
  • 2001, c. 9, s. 195;
  • 2008, c. 28, s. 147.
Marginal note:Acquisition of collateral securities

 The Bank may

  • (a) acquire from any bank or authorized foreign bank that is not subject to the restrictions and requirements referred to in subsection 524(2) of the Bank Act and hold any property held by the bank or authorized foreign bank as security under Part VIII of the Bank Act; and

  • (b) exercise every right and remedy in respect of any security acquired under paragraph (a) that could have been exercised by the bank or authorized foreign bank.

  • R.S., 1985, c. B-2, s. 20;
  • 1992, c. 1, s. 142;
  • 1999, c. 28, s. 96;
  • 2001, c. 9, s. 195.
 
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