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Bank Act (S.C. 1991, c. 46)

Full Document:  

Act current to 2019-08-15 and last amended on 2019-06-21. Previous Versions

PART XVBank Holding Companies (continued)

DIVISION 6Corporate Governance (continued)

Directors and Officers (continued)

Marginal note:Directors’ and officers’ insurance

 A bank holding company may purchase and maintain insurance for the benefit of any person referred to in section 799 against any liability incurred by the person

  • (a) in the capacity of a director or an officer of the bank holding company, except where the liability relates to a failure to act honestly and in good faith with a view to the best interests of the bank holding company; or

  • (b) in the capacity of a director or officer of another entity or while acting in a similar capacity for another entity, if they act or acted in that capacity at the bank holding company’s request, except if the liability relates to a failure to act honestly and in good faith with a view to the best interests of the entity.

  • 2001, c. 9, s. 183
  • 2005, c. 54, s. 116

Marginal note:Application to court for indemnification

  •  (1) A bank holding company or a person referred to in section 799 may apply to a court for an order approving an indemnity under that section and the court may so order and make any further order it thinks fit.

  • Marginal note:Notice to Superintendent

    (2) An applicant under subsection (1) shall give the Superintendent written notice of the application and the Superintendent is entitled to appear and to be heard at the hearing of the application in person or by counsel.

  • Marginal note:Other notice

    (3) On an application under subsection (1), the court may order notice to be given to any interested person and that person is entitled to appear and to be heard in person or by counsel at the hearing of the application.

  • 2001, c. 9, s. 183

Fundamental Changes

Amendments

Marginal note:Sections 215 to 222 apply

 Sections 215 to 222 apply in respect of bank holding companies, subject to the following:

  • (a) references to “bank” in those sections are to be read as references to “bank holding company”;

  • (b) references to “this Act” in those sections are to be read as references to “this Part”;

  • (c) the reference to “subsection 159(1) and section 168” in paragraph 217(1)(i) is to be read as a reference to “subsection 749(1) and section 756”; and

  • (d) the reference to “sections 143 and 144” in subsection 221(1) is to be read as a reference to “sections 732 and 733”.

  • 2001, c. 9, s. 183
Amalgamation

Marginal note:Application to amalgamate

  •  (1) On the joint application of two or more bodies corporate incorporated by or under an Act of Parliament, including banks and bank holding companies but not including federal credit unions, the Minister may issue letters patent amalgamating and continuing the applicants as one bank holding company.

  • Marginal note:Restriction

    (2) Despite subsection (1), if one of the applicants is a bank holding company that controls a bank named in Schedule I as that Schedule read immediately before the day section 184 of the Financial Consumer Agency of Canada Act comes into force, other than a bank in respect of which the Minister has specified that subsection 378(1) no longer applies, the Minister shall not issue letters patent referred to in subsection (1) unless

    • (a) the amalgamated bank holding company would be a widely held bank holding company; or

    • (b) the amalgamated bank holding company would be controlled by a widely held bank holding company that, at the time the application was made, controlled

      • (i) the applicant, or

      • (ii) any other applicant that is a bank holding company that controls a bank named in Schedule I as that Schedule read immediately before the day section 184 of the Financial Consumer Agency of Canada Act comes into force, other than a bank in respect of which the Minister has specified that subsection 378(1) no longer applies.

  • Marginal note:Restriction

    (3) Despite subsection (1), if the amalgamated bank holding company would be a bank holding company with equity of twelve billion dollars or more, the Minister shall not issue letters patent referred to in that subsection unless the amalgamated bank holding company is

    • (a) widely held;

    • (b) controlled, within the meaning of paragraphs 3(1)(a) and (d), by a widely held bank, or by a widely held bank holding company, that controlled one of the applicants at the time the application was made; or

    • (c) controlled, within the meaning of paragraph 3(1)(d), by a widely held insurance holding company, or by an eligible Canadian financial institution, within the meaning of subsection 370(1), other than a bank, or by an eligible foreign institution, within the meaning of subsection 370(1), that controlled one of the applicants at the time the application was made.

  • 2001, c. 9, s. 183
  • 2007, c. 6, s. 132
  • 2010, c. 12, s. 2084
  • 2012, c. 5, s. 80

Marginal note:Amalgamation agreement

  •  (1) Each applicant proposing to amalgamate shall enter into an amalgamation agreement.

  • Marginal note:Contents of agreement

    (2) Every amalgamation agreement shall set out the terms and means of effecting the amalgamation and, in particular,

    • (a) the name of the amalgamated bank holding company and the province in which its head office is to be situated;

    • (b) the name and place of ordinary residence of each proposed director of the amalgamated bank holding company;

    • (c) the manner in which the shares of each applicant are to be converted into shares or other securities of the amalgamated bank holding company;

    • (d) if any shares of an applicant are not to be converted into shares or other securities of the amalgamated bank holding company, the amount of money or securities that the holders of those shares are to receive in addition to or in lieu of shares or other securities of the amalgamated bank holding company;

    • (e) the manner of payment of money in lieu of the issue of fractional shares of the amalgamated bank holding company or of any other body corporate that are to be issued in the amalgamation;

    • (f) the proposed by-laws of the amalgamated bank holding company;

    • (g) details of any other matter necessary to perfect the amalgamation and to provide for the subsequent management and operation of the amalgamated bank holding company; and

    • (h) the proposed effective date of the amalgamation.

  • Marginal note:Cross ownership of shares

    (3) If shares of one of the applicants are held by or on behalf of another of the applicants, other than shares held in the capacity of a personal representative or by way of security, the amalgamation agreement must provide for the cancellation of those shares when the amalgamation becomes effective without any repayment of capital in respect thereof, and no provision shall be made in the agreement for the conversion of those shares into shares of the amalgamated bank holding company.

  • 2001, c. 9, s. 183
  • 2005, c. 54, s. 117

Marginal note:Approval of agreement by Superintendent

 An amalgamation agreement must be submitted to the Superintendent for approval and any approval of the agreement under subsection 806(4) by the holders of any class or series of shares of an applicant is invalid unless, before the date of the approval, the Superintendent has approved the agreement in writing.

  • 2001, c. 9, s. 183
  • 2007, c. 6, s. 115

Marginal note:Shareholder approval

  •  (1) The directors of each applicant shall submit an amalgamation agreement for approval to a meeting of the holders of shares of the applicant body corporate of which they are directors and, subject to subsection (3), to the holders of each class or series of such shares.

  • Marginal note:Right to vote

    (2) Each share of an applicant carries the right to vote in respect of an amalgamation agreement whether or not it otherwise carries the right to vote.

  • Marginal note:Separate vote for class or series

    (3) The holders of shares of a class or series of shares of each applicant are entitled to vote separately as a class or series in respect of an amalgamation agreement if the agreement contains a provision that, if it were contained in a proposed amendment to the by-laws or incorporating instrument of the applicant, would entitle those holders to vote separately as a class or series.

  • Marginal note:Special resolution

    (4) Subject to subsection (3), an amalgamation agreement is approved when the shareholders of each applicant that is a body corporate have approved the amalgamation by special resolution.

  • Marginal note:Termination

    (5) An amalgamation agreement may provide that, at any time before the issue of letters patent of amalgamation, the agreement may be terminated by the directors of an applicant notwithstanding that the agreement has been approved by the shareholders of all or any of the applicant bodies corporate.

  • 2001, c. 9, s. 183
  • 2005, c. 54, s. 118
 
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