Advanced Search

• 26 (1) Other than as prescribed by this section, the Minister’s liability to a lender with respect to a business improvement loan made pursuant to the Act ceases if the loan is transferred to, assigned to or acquired by another lender or any other person.

• (2) Where a lender has made business improvement loans under the Act and the lender subsequently sells all of the business improvement loans outstanding on its books to another lender that is the successor lender, or amalgamates with one or more other lenders to form a newly amalgamated lender, the Minister’s liability under the Act continues in favour of the successor lender or the newly amalgamated lender, as the case may be, on the basis that, as of the effective date of the purchase or amalgamation,

  • (a) the amount of all business improvement loans that were made by the selling lender and the successor lender or by the amalgamating lenders and that were registered by the Minister pursuant to section 25 shall be aggregated and deemed for the purpose of section 5 of the Act to have been made by the successor lender or the newly amalgamated lender, as the case may be; and

  • (b) the amount of all claims for loss previously paid by the Minister to the selling lender and the successor lender or to the amalgamating lenders, as the case may be, shall be aggregated and deemed to be a loss sustained by the successor lender or the newly amalgamated lender, as the case may be, for the purpose of section 5 of the Act.

• (3) Subject to subsection (4), where a lender has made business improvement loans under the Act and the lender subsequently

  • (a) sells all of the business improvement loans outstanding on its books to a purchaser that is a credit union, caisse populaire or other cooperative credit society or a corporation that, while not as yet designated by the Minister as a lender for the purposes of the Act, is eligible to be designated as a lender pursuant to paragraph (b) or (c) of the definition lender in section 2 of the Act, or

  • (b) amalgamates with one or more credit unions, caisses populaires or other cooperative credit societies or corporations to form an amalgamated corporation that, while not as yet designated by the Minister as a lender for the purposes of the Act, is eligible to be designated as a lender pursuant to paragraph (b) or (c) of the definition lender in section 2 of the Act,

  the Minister’s liability under the Act continues in favour of the purchaser or amalgamated corporation, as the case may be, if as of the effective date of the purchase or amalgamation,

  • (c) the amount of all business improvement loans that were made by the selling lender or the amalgamating lender and that were registered by the Minister pursuant to section 25 are deemed to have been made by the purchaser or the amalgamated corporation, as the case may be, and

  • (d) the amount of all claims for loss previously paid by the Minister to the selling lender or the amalgamating lender, as the case may be, are deemed to be a loss sustained by the purchaser or amalgamated corporation, as the case may be, for the purpose of section 5 of the Act.

• (4) In the case of a sale or amalgamation referred to in subsection (3), the Minister’s liability continues only if

  • (a) the purchaser or the amalgamated corporation, as the case may be, applies to the Minister, before the acquisition or amalgamation or within one year thereafter, for designation as a lender for the purposes of the Act and for continuity of the Minister’s liability under the Act with respect to those business improvement loans that had been made by the selling or amalgamating lender; and

  • (b) the Minister designates the purchaser or the amalgamated corporation as a lender for the purposes of the Act.

[...]

• [...]

• (1.3) A request for an extension of the period of 19 months referred to in subsection (1.1) shall be made before the expiration of that period or of that period as extended by the Minister, as the case may be.

• (2) The loss sustained by a lender in respect of a loan shall be determined by aggregating the following, namely,

  • [...]

  • (b) interest earned on the loan over any period and outstanding at the time the claim is approved for payment by the Minister, calculated

    • [...]

    • (ii) where the interest was earned over a period of more than 180 days,

      • (A) at the rate of interest referred to in subparagraph (i) for the first 180 days of the period or, where in the opinion of the Minister reasons beyond the control of the lender justify calculating the interest at that rate for more than 180 days, at that rate for such greater number of days as are approved by the Minister, and

• [...]

• (2.2) Subject to subsection (2.3), where, in the case of any loan by a lender, the evidence submitted by the lender pursuant to paragraph (3)(c) shows that

  • (a) the actual cost of the fixed equipment, movable equipment, premises or land, as the case may be, in respect of which the loan was made was less than the estimated cost shown in the application for the loan, and the loan was made in an amount exceeding

    [...]

    as the case may be or

  the loss sustained by the lender in respect of the loan shall, notwithstanding subsection (2), be determined as that proportion of the amount determined pursuant to subsection (2) that

  [...]

• [...]

• (3) Every claim for loss shall be certified by a responsible officer of the lender and shall be accompanied by:

  • [...]

  • (c) documentation substantiating

    • (i) the actual cost of the fixed equipment, movable equipment, premises or land, as the case may be, in respect of which the loan was made, and

• [...]

• (5) Where a claim for loss by a lender has been paid pursuant to subsection (4), the lender shall

  • [...]

  • (b) deal with any security held by it for the loan in such manner as the Minister may direct.

[...]

15 The maximum rate of interest per annum payable, as set out in the written promise to repay, to a lender in respect of a loan shall be the aggregate of one per cent per annum and

• (a) in the case of a lender incorporated by or under the provisions of the Bank Act or established pursuant to the Treasury Branches Act of Alberta, the prime lending rate, as fixed daily during the term of the loan, of that lender;

• (b) in the case of a lender that is a credit union, caisse populaire or other cooperative credit society and that is designated by the Minister as a lender for the purposes of the Act, the prime lending rate, as fixed daily during the term of the loan, of any one of the following institutions that is selected by the lender when the loan is made, namely,

  • [...]

  • (iv) the lender’s provincial central, federation, league or society, as the case may be; or

• (c) in the case of a lender that is a trust, loan or insurance corporation that is designated by the Minister as a lender for the purposes of the Act, the prime lending rate, as fixed daily during the term of the loan, of any one of the lenders chartered under the Bank Act that is selected by the lender when the loan is made.

[...]

• 13 (1) A lender shall, at the time of making a loan of any prescribed class, acquire and perfect security for the repayment thereof by way of a security interest, in a form consistent with normal banking practice, in the fixed equipment, movable equipment, premises or land, as the case may be, in respect of which the funds advanced are to be expended.

• [...]

• (1.2) Subsections (1) or (1.1), as the case may be, apply in respect of a loan even if normal banking practices would not require a lender to take any security for the loan.

• (2) A lender may release any security acquired in respect of a loan pursuant to subsections (1) or (1.1), as the case may be, but shall, throughout the term of the loan remaining after such release, maintain adequate security in accordance with normal banking practice for the repayment of the balance of the loan outstanding at any time.

[...]

• [...]

• (2) Notwithstanding subsection (1), where the insurance premium is expressed as a percentage of the loan outstanding, it may be combined with the rate of the interest if the resultant rate of interest, as set out in the written promise to repay the loan, does not exceed the maximum rate prescribed by section 15.

[...]