Financial System Review Act (S.C. 2012, c. 5)
Full Document:
Assented to 2012-03-29
Marginal note:2001, c. 9, s. 183; 2007, c. 6, par. 132(z.5)
87. Subsection 882(1) of the Act is replaced by the following:
Marginal note:Prohibition against control
882. (1) No person shall control, within the meaning of paragraph 3(1)(d), a bank holding company with equity of twelve billion dollars or more.
Marginal note:2001, c. 9, s. 183; 2007, c. 6, s. 119 and par. 132(z.6)
88. Sections 883 and 884 of the Act are replaced by the following:
Marginal note:Restriction on control
883. (1) No person shall, without the approval of the Minister, acquire control, within the meaning of paragraph 3(1)(d), of a bank holding company with equity of less than twelve billion dollars.
Marginal note:Amalgamation, etc., constitutes acquisition
(2) If the entity that would result from an amalgamation, a merger or a reorganization would control, within the meaning of paragraph 3(1)(d), a bank holding company with equity of less than twelve billion dollars, the entity is deemed to be acquiring control, within the meaning of that paragraph, of the bank holding company through an acquisition for which the approval of the Minister is required under subsection (1).
Marginal note:Deeming
884. A bank holding company with equity of less than twelve billion dollars that controls a bank to which subsection 378(1) applies is deemed, for the purposes of sections 156.09, 727, 876, 879, 879.1, 880, 881, 882, 888 and 890, subsection 891(2), section 893 and subsection 906(2), to be a bank holding company with equity of twelve billion dollars or more.
Marginal note:2001, c. 9, s. 183; 2007, c. 6, par. 132(z.7)
89. Section 888 of the Act is replaced by the following:
Marginal note:Exemption
888. On application by a bank holding company, other than a bank holding company with equity of twelve billion dollars or more, the Superintendent may exempt any class of non-voting shares of the bank holding company the aggregate book value of which is not more than 30 per cent of the aggregate book value of all the outstanding shares of the bank holding company from the application of sections 875 and 887.
Marginal note:2001, c. 9, s. 183; 2007, c. 6, par. 132(z.8)
90. Subsection 890(1) of the Act is replaced by the following:
Marginal note:When approval not required
890. (1) Despite sections 875 and 887, the approval of the Minister is not required in respect of a bank holding company with equity of less than twelve billion dollars if a person with a significant interest in a class of shares of the bank holding company, or an entity controlled by a person with a significant interest in a class of shares of the bank holding company, purchases or otherwise acquires shares of that class, or acquires control of any entity that holds any share of that class, and the number of shares of that class purchased or otherwise acquired, or the acquisition of control of the entity, as the case may be, would not increase the significant interest of the person in that class of shares of the bank holding company to a percentage that is greater than the percentage referred to in subsection (2) or (3), whichever is applicable.
Marginal note:2001, c. 9, s. 183; 2007, c. 6, par. 132(z.9)
91. Subsection 891(2) of the Act is replaced by the following:
Marginal note:Exception
(2) Paragraph (1)(a) does not apply in respect of a bank holding company with equity of twelve billion dollars or more.
Marginal note:2001, c. 9, s. 183; 2007, c. 6, par. 132(z.10) and 133(c)
92. (1) The portion of subsection 893(1) of the Act before paragraph (a) is replaced by the following:
Marginal note:Public holding requirement
893. (1) Every bank holding company with equity of two billion dollars or more but less than twelve billion dollars shall, from and after the day determined under this section in respect of that bank holding company, have, and continue to have, voting shares that carry at least 35 per cent of the voting rights attached to all of the outstanding voting shares of the bank holding company and that are
Marginal note:2001, c. 9, s. 183; 2007, c. 6, par. 132(z.11) and 133(c)
(2) Paragraph 893(2)(a) of the Act is replaced by the following:
(a) if the bank holding company had equity of two billion dollars or more but less than twelve billion dollars on the day the bank holding company was formed or came into existence, the day that is three years after that day; and
Marginal note:2001, c. 9, s. 183; 2007, c. 6, par. 132(z.12)
93. Section 894 of the Act is replaced by the following:
Marginal note:Public holding requirement
894. If a bank holding company to which section 893 applies becomes a bank holding company with equity of twelve billion dollars or more, that section continues to apply to the bank holding company until no person is a major shareholder of the bank holding company, other than a person in respect of whom subsections 876(2) to (6) applies.
Marginal note:2001, c. 9, s. 183; 2007, c. 6, par. 132(z.13) and 133(d)
94. Section 896 of the Act is replaced by the following:
Marginal note:Increase of capital
896. If the Superintendent has, by order, directed a bank holding company with equity of two billion dollars or more but less than twelve billion dollars to increase its capital and shares of the bank holding company are issued and acquired in accordance with any terms and conditions that may be specified in the order, section 893 does not apply in respect of the bank holding company until the time that the Superintendent may, by order, specify.
Marginal note:2001, c. 9, s. 183; 2007, c. 6, par. 132(z.14)
95. Subsection 902(1) of the Act is replaced by the following:
Marginal note:Loss of control — bank and bank holding company
902. (1) Despite sections 876 and 882, a widely held bank or a widely held bank holding company may be a major shareholder of a bank holding company with equity of twelve billion dollars or more and cease to control, within the meaning of paragraphs 3(1)(a) and (d), the bank holding company if it has entered into an agreement with the Minister to do all things necessary to ensure that it is not a major shareholder of the bank holding company on the expiration of the day specified in the agreement.
Marginal note:2001, c. 9, s. 183; 2007, c. 6, par. 132(z.15)
96. Subsection 903(1) of the Act is replaced by the following:
Marginal note:Loss of control — other entities
903. (1) Despite sections 876 and 882, an eligible foreign institution, an eligible Canadian financial institution, other than a bank, or a widely held insurance holding company may be a major shareholder of a bank holding company with equity of twelve billion dollars or more and cease to control, within the meaning of paragraph 3(1)(d), the bank holding company if it has entered into an agreement with the Minister to do all things necessary to ensure that it is not a major shareholder of the bank holding company on the expiration of the day specified in the agreement.
Marginal note:2001, c. 9, s. 183; 2007, c. 6, par. 132(z.16)
97. The portion of subsection 904(1) of the Act before paragraph (a) is replaced by the following:
Marginal note:Change in status
904. (1) If a body corporate that is an eligible financial institution other than a bank controls, within the meaning of paragraph 3(1)(d), a bank holding company with equity of twelve billion dollars or more and the body corporate subsequently ceases to be an eligible financial institution, the body corporate must do all things necessary to ensure that, on the day that is one year after the day it ceased to be an eligible financial institution,
Marginal note:2001, c. 9, s. 183; 2007, c. 6, par. 132(z.17)
98. Paragraph 906(2)(a) of the Act is replaced by the following:
(a) more than 10 per cent but no more than 20 per cent of any class of the outstanding voting shares of a widely held bank holding company with equity of twelve billion dollars or more; or
Marginal note:2001, c. 9, s. 183
99. Subsection 913(2) of the Act is replaced by the following:
Marginal note:Exception
(2) Despite subsection (1), a bank holding company may record in its securities register a transfer or issue of any share of the bank holding company to a foreign bank, or to a foreign institution, that is controlled by the government of a foreign country or any political subdivision of a foreign country, or by any agent or agency of a foreign government, if the share that is transferred or issued is beneficially owned by the foreign bank or foreign institution or by an entity controlled by the foreign bank or foreign institution.
Marginal note:2001, c. 9, s. 183
100. Subsection 914(2) of the Act is replaced by the following:
Marginal note:Exception
(2) Subsection (1) does not apply to a foreign bank, or to a foreign institution, that is controlled by the government of a foreign country or any political subdivision of a foreign country, or by any agent or agency of a foreign government, if the share referred to in subsection (1) is beneficially owned by the foreign bank or foreign institution or by an entity controlled by the foreign bank or foreign institution.
Marginal note:2007, c. 6, s. 122(3)
101. (1) Subsection 930(3.1) of the Act is replaced by the following:
Marginal note:Exception
(3.1) Despite paragraph (3)(a), a bank holding company may acquire control of, or acquire or increase a substantial investment in, any entity that acts as a trustee for a trust if the entity has been permitted under the laws of a province to act as a trustee for a trust and the following conditions are satisfied:
(a) the entity acts as a trustee only with respect to a closed-end fund or mutual fund entity; and
(b) if the entity engages in other business, that business is limited to engaging in one or more of the following:
(i) the activities of a mutual fund distribution entity,
(ii) any activity that a bank is permitted to engage in under paragraph 410(1)(c.2), and
(iii) the provision of investment counselling services and portfolio management services.
(2) Subsection 930(5) of the Act is amended by adding the following after paragraph (b):
(b.1) acquire control of an entity referred to in paragraph (1)(j) if the bank holding company is a bank holding company with equity of two billion dollars or more and
A + B > C
where
- A
- is the value of the entity’s consolidated assets, as it would have been reported in the entity’s annual financial statements if those statements had been prepared immediately before the acquisition,
- B
- is the aggregate of the values of the consolidated assets of all other entities referred to in paragraph (1)(j) that the bank holding company has acquired control of within the preceding 12 months, as the value for each entity would have been reported in its annual financial statements if those statements had been prepared immediately before the acquisition of control of that entity, and
- C
- is 10% of the value of the bank holding company’s consolidated assets, as shown in the bank holding company’s last annual statement that was prepared before its first acquisition of control of an entity referred to in paragraph (1)(j) within the preceding 12 months;
(3) Section 930 of the Act is amended by adding the following after subsection (5):
Marginal note:Matters for consideration
(5.1) In addition to any matters or conditions provided for in this Act that are relevant to the granting of an approval, the Minister may, in considering whether to grant the approval under paragraph (5)(b.1), take into account all matters that he or she considers relevant in the circumstances, including
(a) the stability of the financial system in Canada; and
(b) the best interests of the financial system in Canada.
- Date modified: