Government of Canada / Gouvernement du Canada
Symbol of the Government of Canada

Search

Bank Act (S.C. 1991, c. 46)

Full Document:  

Act current to 2022-05-02 and last amended on 2022-02-26. Previous Versions

PART XII.1Authorized Foreign Banks (continued)

Supervision (continued)

Returns (continued)

Marginal note:Disclosure by Superintendent

  •  (1) The Superintendent shall disclose, at the times and in the manner that the Minister may determine, any information obtained by the Superintendent under this Act that the Minister considers ought to be disclosed for the purposes of the analysis of the business in Canada of an authorized foreign bank and that

    • (a) is contained in returns filed pursuant to the Superintendent’s financial regulatory reporting requirements in respect of authorized foreign banks; or

    • (b) has been obtained as a result of an industry-wide or sectoral survey conducted by the Superintendent in relation to an issue or circumstances that could have an impact on the business in Canada of authorized foreign banks.

  • Marginal note:Prior consultation required

    (2) The Minister shall consult with the Superintendent before making any determination under subsection (1).

  • 1999, c. 28, s. 35

Marginal note:Disclosure by an authorized foreign bank

  •  (1) An authorized foreign bank shall make available to the public any information concerning

    • (a) the compensation of its executives, as that expression is defined by the regulations, and

    • (b) its business and affairs for the purposes of the analysis of its business in Canada,

    in the form and manner and at the times that may be required by or under regulations that the Governor in Council may make for the purpose.

  • Marginal note:Exemption by regulation

    (2) Paragraph (1)(a) does not apply to an authorized foreign bank that is within any class or classes of authorized foreign banks that may be prescribed.

  • 1999, c. 28, s. 35

Marginal note:Exceptions to disclosure

 Subject to any regulations made under section 576, information obtained by an authorized foreign bank regarding any of its customers shall not be disclosed or made available under subsection 609(1) or section 610.

  • 1999, c. 28, s. 35

Marginal note:Report respecting disclosure

 The Superintendent shall prepare a report respecting the disclosure of information by authorized foreign banks and describing the state of progress made in enhancing the disclosure of information in the financial services industry. The report is to be included in the report referred to in section 40 of the Office of the Superintendent of Financial Institutions Act.

  • 1999, c. 28, s. 35
  • 2001, c. 9, s. 165

Inspection of Authorized Foreign Banks

Marginal note:Examination of authorized foreign banks

  •  (1) The Superintendent, from time to time, but, in the case of an authorized foreign bank that is not subject to the restrictions and requirements referred to in subsection 524(2), at least once in each calendar year, shall make or cause to be made any examination and inquiry into the business and affairs of each authorized foreign bank that the Superintendent considers to be necessary or expedient to determine whether the authorized foreign bank is complying with the provisions of this Act and, after the conclusion of each examination and inquiry, shall report on it to the Minister.

  • Marginal note:Access to records of authorized foreign bank

    (2) The Superintendent or a person acting under the Superintendent’s direction

    • (a) has a right of access to any records, cash, assets and security held by or on behalf of an authorized foreign bank; and

    • (b) may require the directors, officers and the auditor of an authorized foreign bank to provide information and explanations, to the extent that they are reasonably able to do so, in respect of the condition and affairs of the authorized foreign bank or any entity in which it has a substantial investment under Part XII.

  • 1999, c. 28, s. 35
  • 2001, c. 9, s. 166
  • 2012, c. 5, s. 74

Marginal note:Power of Superintendent on inquiry

 The Superintendent has all the powers of a person appointed as a commissioner under Part II of the Inquiries Act for the purpose of obtaining evidence under oath, and may delegate those powers to any person acting under the Superintendent’s direction.

  • 1999, c. 28, s. 35

Remedial Powers

Prudential Agreements

Marginal note:Prudential agreement

 The Superintendent may enter into an agreement, called a “prudential agreement”, with an authorized foreign bank for the purposes of implementing any measure designed to protect the interests of its depositors and creditors in respect of its business in Canada.

  • 2001, c. 9, s. 167

Directions of Compliance

Marginal note:Superintendent’s directions to authorized foreign bank

  •  (1) Where, in the opinion of the Superintendent, an authorized foreign bank, or a person with respect to an authorized foreign bank, is committing, or is about to commit, an act that is an unsafe or unsound practice in relation to the business in Canada of the authorized foreign bank, or is pursuing or is about to pursue any course of conduct that is an unsafe or unsound practice in relation to that business, the Superintendent may direct the authorized foreign bank or person to

    • (a) cease or refrain from committing the act or pursuing the course of conduct; and

    • (b) perform any acts that in the opinion of the Superintendent are necessary to remedy the situation.

  • Marginal note:Opportunity for representations

    (2) Subject to subsection (3), no direction shall be issued to an authorized foreign bank or person unless the authorized foreign bank or person is provided with a reasonable opportunity to make representations in respect of the matter.

  • Marginal note:Temporary direction

    (3) Where, in the opinion of the Superintendent, the length of time required for representations to be made might be prejudicial to the public interest, the Superintendent may make a temporary direction with respect to the matters referred to in paragraphs (1)(a) and (b) having effect for a period of not more than fifteen days.

  • Marginal note:Continuing effect

    (4) A temporary direction continues to have effect after the expiration of the fifteen day period referred to in subsection (3) if no representations are made to the Superintendent within that period or, if representations have been made, the Superintendent notifies the authorized foreign bank or person that the Superintendent is not satisfied that there are sufficient grounds for revoking the direction.

  • 1999, c. 28, s. 35

Marginal note:Court enforcement

  •  (1) Where an authorized foreign bank or a person

    • (a) is contravening or has failed to comply with a prudential agreement entered into under section 614.1 or a direction of the Superintendent made under subsection 615(1) or (3),

    • (b) is contravening this Act, or

    • (c) has omitted to do any thing under this Act that is required to be done by or on the part of the authorized foreign bank or person,

    the Superintendent may, in addition to any other action that may be taken under this Act, apply to a court for an order requiring the authorized foreign bank or person to comply with the prudential agreement or the direction, cease the contravention or do any thing that is required to be done, and on the application the court may so order and make any other order it thinks fit.

  • Marginal note:Appeal

    (2) An appeal from a decision of a court under subsection (1) lies in the same manner, and to the same court, as an appeal from any other order of the court.

  • 1999, c. 28, s. 35
  • 2001, c. 9, s. 168

Asset Maintenance

Marginal note:Order re: asset maintenance

 Where, in the opinion of the Superintendent, it is necessary for the protection of rights of depositors and creditors of the authorized foreign bank in respect of its business in Canada, the Superintendent may, by order,

  • (a) subject to any terms and conditions that the Superintendent considers necessary, direct an authorized foreign bank to maintain in Canada assets of any type and in any amount that the Superintendent may specify; and

  • (b) require that the assets referred to in paragraph (a) be deposited with a Canadian financial institution approved by the Superintendent under a deposit agreement approved by the Superintendent.

  • 1999, c. 28, s. 35

Disqualification and Removal of Principal Officers

Marginal note:Application

  •  (1) This section applies only in respect of an authorized foreign bank

    • (a) that has been notified by the Superintendent that this section applies to it where the authorized foreign bank is subject to measures designed to protect the interests of its depositors and creditors in respect of its business in Canada, which measures

      • (i) have been specified by the Superintendent by way of conditions or limitations in respect of the order approving the commencement and carrying on of business in Canada by the authorized foreign bank, or

      • (ii) are contained in a prudential agreement entered into under section 614.1 or an undertaking given by the authorized foreign bank to the Superintendent; or

    • (b) that is the subject of a direction made under section 615 or an order made under section 617.

  • Marginal note:Information to be provided

    (2) An authorized foreign bank shall provide the Superintendent with the name of any person who has been selected by the authorized foreign bank for appointment as principal officer, together with such other information about the background, business record and experience of the person as the Superintendent may require.

  • Marginal note:When information to be provided

    (3) The information required by subsection (2) shall be provided to the Superintendent at least 30 days prior to the date of the appointment or within any shorter period that the Superintendent may allow.

  • Marginal note:Disqualification

    (4) If the Superintendent is of the opinion that, on the basis of the competence, business record, experience, conduct or character of a person, he or she is not suitable to hold the position of principal officer, the Superintendent may, by order, disqualify the person from being appointed to that office.

  • Marginal note:Risk of prejudice

    (5) In forming an opinion under subsection (4), the Superintendent must consider whether the interests of the depositors and creditors of the authorized foreign bank in respect of its business in Canada would likely be prejudiced if the person were to take office.

  • Marginal note:Representations may be made

    (6) The Superintendent must in writing notify the person concerned and the authorized foreign bank of an order that the Superintendent proposes to make under subsection (4) and must afford them an opportunity within 15 days after the date of the notice, or within any longer period that the Superintendent allows, to make representations to the Superintendent in relation to the matter.

  • Marginal note:Prohibition

    (7) If an order is made under subsection (4) disqualifying a person from being appointed as principal officer, the person shall not be, and the authorized foreign bank shall not permit the person to be, appointed to that position.

  • 2001, c. 9, s. 169

Marginal note:Removal

  •  (1) The Superintendent may, by order, remove a person from office as the principal officer of an authorized foreign bank if the Superintendent is of the opinion that the person is not suitable to hold that office

    • (a) on the basis of the competence, business record, experience, conduct or character of the person; or

    • (b) because the person has contravened or, by action or negligence, has contributed to the contravention of

      • (i) this Act or the regulations made under it,

      • (ii) a direction made under section 615,

      • (iii) an order made under section 617,

      • (iv) a condition or limitation in respect of the order approving the commencement and carrying on of business in Canada by the authorized foreign bank, or

      • (v) a prudential agreement entered into under section 614.1 or an undertaking given by the authorized foreign bank to the Superintendent.

  • Marginal note:Risk of prejudice

    (2) In forming an opinion under subsection (1), the Superintendent must consider whether the interests of the depositors and creditors of the authorized foreign bank in respect of its business in Canada have been or are likely to be prejudiced by the person’s holding office as principal officer.

  • Marginal note:Representations may be made

    (3) The Superintendent must in writing notify the principal officer and the authorized foreign bank of any removal order that the Superintendent proposes to make under subsection (1) and must afford them an opportunity within 15 days after the date of the notice, or within any longer period that the Superintendent allows, to make representations to the Superintendent in relation to the matter.

  • Marginal note:Suspension

    (4) If the Superintendent is of the opinion that the public interest is likely to be prejudiced by the principal officer continuing to exercise the powers or carry out the duties and functions of that office during the period for making representations, the Superintendent may make an order suspending the principal officer. The suspension may not extend beyond 10 days after the expiration of that period.

  • Marginal note:Notice of order

    (5) The Superintendent shall, without delay, notify the principal officer and the authorized foreign bank of a removal order or suspension order.

  • Marginal note:Consequences of removal order

    (6) The principal officer ceases to hold that office as of the date the removal order is made or any later date specified in the order.

  • Marginal note:Appeal

    (7) The principal officer or the authorized foreign bank may, within 30 days after the date of receipt of notice of the removal order under subsection (5), or within any longer period that the Court allows, appeal the matter to the Federal Court.

  • Marginal note:Powers of Federal Court

    (8) The Federal Court, in the case of an appeal, may dismiss the appeal or set aside the removal order.

  • Marginal note:Order not stayed by appeal

    (9) A removal order is not stayed by an appeal.

  • 2001, c. 9, s. 169

Supervisory Intervention

Meaning of assets

 For the purposes of sections 619 to 627, assets, in relation to an authorized foreign bank, means

  • (a) any asset in respect of its business in Canada, including the assets referred to in subsection 582(1) and section 617 and the assets under its administration; and

  • (b) any other asset in Canada of the authorized foreign bank.

  • 1999, c. 28, s. 35

Marginal note:Superintendent may take control

  •  (1) Subject to this Act, where any of the circumstances described in subsection (2) exist in respect of an authorized foreign bank or the business in Canada of an authorized foreign bank, the Superintendent may

    • (a) take control, for a period not exceeding sixteen days, of the assets of the authorized foreign bank; or

    • (b) unless the Minister advises the Superintendent that the Minister is of the opinion that it is not in the public interest to do so,

      • (i) take control, for a period exceeding sixteen days, of the assets of the authorized foreign bank, or

      • (ii) where control of assets has been taken under paragraph (a), continue the control beyond the sixteen days referred to in that paragraph.

  • Marginal note:Circumstances for taking control

    (2) Control by the Superintendent under subsection (1) may be taken in respect of an authorized foreign bank where

    • (a) the authorized foreign bank has failed to pay its liabilities or, in the opinion of the Superintendent, will not be able to pay its liabilities as they become due and payable;

    • (b) the authorized foreign bank in respect of its business in Canada has failed to pay its liabilities or, in the opinion of the Superintendent, will not be able to pay its liabilities as they become due and payable;

    • (c) [Repealed, 2001, c. 9, s. 170]

    • (d) the assets of the authorized foreign bank in relation to its business in Canada are not, in the opinion of the Superintendent, sufficient to give adequate protection to the depositors and creditors of the authorized foreign bank in respect of its business in Canada;

    • (e) an asset appearing on the books or records of the authorized foreign bank in respect of its business in Canada or held under its administration is not, in the opinion of the Superintendent, satisfactorily accounted for;

    • (f) the authorized foreign bank has failed to comply with an order of the Superintendent under section 617; or

    • (g) in the opinion of the Superintendent, any other state of affairs exists in respect of the authorized foreign bank that may be materially prejudicial to the interests of the authorized foreign bank’s depositors or creditors in respect of its business in Canada or to those of the owners of any assets under the authorized foreign bank’s administration in respect of its business in Canada, including where proceedings under a law relating to bankruptcy or insolvency have been commenced in Canada or elsewhere in respect of the authorized foreign bank or its holding body corporate.

  • Marginal note:Notice of proposed action

    (3) The Superintendent shall notify an authorized foreign bank of any action proposed to be taken in respect of it under paragraph (1)(b) and of its right to make written representations to the Superintendent within the time specified in the notice, not exceeding ten days after it receives the notice.

  • Marginal note:Objectives of Superintendent

    (4) Where, pursuant to subsection (1), the Superintendent has control of the assets of an authorized foreign bank, the Superintendent may do all things necessary or expedient to protect the rights and interests of the depositors and creditors of the authorized foreign bank in respect of its business in Canada.

  • Marginal note:Powers of Superintendent

    (5) Where, pursuant to subsection (1), the Superintendent has control of the assets of an authorized foreign bank,

    • (a) neither the authorized foreign bank nor any person acting on its behalf shall deal in any way with any of the assets without the prior approval of the Superintendent or a representative designated by the Superintendent; and

    • (b) no person acting on behalf of the authorized foreign bank shall have access to any cash or securities held in Canada by the authorized foreign bank without the prior approval of the Superintendent or a representative designated by the Superintendent.

  • Marginal note:Persons to assist

    (6) Where the Superintendent takes control of the assets of an authorized foreign bank under subparagraph (1)(b)(i) or (ii), the Superintendent may appoint one or more persons to assist in the control of the assets.

  • 1999, c. 28, s. 35
  • 2001, c. 9, s. 170
  • 2007, c. 6, s. 101
 
Date modified: