Canada Deposit Insurance Corporation Act (R.S.C., 1985, c. C-3)

Marginal note:Minister’s direction

• 11.1 (1) The Minister may, after consultation with the Board, the Governor of the Bank of Canada and the Superintendent, give a written direction to the Corporation if the Minister is of the opinion that not giving the direction might have an adverse effect on the stability of the financial system in Canada or public confidence in that stability.

• Marginal note:Compliance without regard to minimizing loss

  (2) The Corporation shall comply with the direction without regard to the requirement referred to in paragraph 7(c) that it pursue its objects in a manner that will minimize its exposure to loss.

• Marginal note:Implementation

  (3) The Corporation’s directors shall ensure that the direction is implemented in a prompt and efficient manner and, if in so doing they act in accordance with section 115 of the Financial Administration Act, they are not accountable for any consequences arising from the implementation of the direction.

• Marginal note:Notification of implementation

  (4) After implementing the direction, the Corporation shall notify the Minister without delay that the direction has been implemented.

• Marginal note:Best interests

  (5) The Corporation’s compliance with a direction is deemed to be in its best interests.

Marginal note:Statutory Instruments Act

• 11.2 (1) The Statutory Instruments Act does not apply to a direction given under subsection 11.1(1).

• Marginal note:Publication

  (2) The Minister shall cause a notice to be published in the Canada Gazette that a direction was given under subsection 11.1(1) as soon as the Minister is of the opinion that the publication of the notice will not have an adverse effect on the stability of the financial system in Canada or public confidence in that stability.

Marginal note:Recovery of loss

11.3 After the publication of a notice in the Canada Gazette that a direction was given under subsection 11.1(1), the Corporation shall, in accordance with its by-laws, collect a special premium from member institutions or any class of member institutions in order to recover the loss that the Corporation determines it incurred as a result of complying with the direction.

Deposit Insurance

Marginal note:Duty to insure

12 The Corporation shall insure each deposit with a member institution except

• (a) a deposit that is not payable in Canada;

• (b) a deposit in respect of which Her Majesty in right of Canada would be a preferred claimant; and

• (c) so much of any one deposit as exceeds one hundred thousand dollars.

12.01 [Repealed, 2023, c. 26, s. 628]

Marginal note:Definitions

• 12.1 (1) The following definitions apply in this section.

  continuation day

  continuation day, in respect of a local cooperative credit society continued as a federal credit union, means the day set out in the federal credit union’s letters patent continuing the local cooperative credit society as a federal credit union. (date de prorogation)

  pre-existing deposit

  pre-existing deposit means a deposit that was made with a local cooperative credit society before it is continued as a federal credit union and that remains outstanding on the continuation day. (dépôt préexistant)

  transition period

  transition period, in respect of a pre-existing deposit, means

  • (a) in the case of a pre-existing deposit that is to be repaid on a fixed day, the period that begins on the continuation day and ends on that fixed day; and

  • (b) in the case of any other pre-existing deposit, the period that begins on the continuation day and ends on the day that is 180 days after the continuation day. (période transitoire)

• Marginal note:Duty to insure certain pre-existing deposits

  (2) Despite paragraph 12(c) and subsection 3(1.1) of the schedule, but subject to the other provisions of this Act, if a pre-existing deposit is held by a federal credit union that is a member institution and all or a portion of the pre-existing deposit would have been guaranteed or insured under the law of a province if the local cooperative credit society had not been continued as a federal credit union, the Corporation shall insure the pre-existing deposit during the transition period up to the amount that would have been guaranteed or insured under the law of that province.

• Marginal note:Duty to insure certain pre-existing deposits repayable on a fixed day

  (3) Despite paragraph 2(2)(a) of the schedule, the Corporation shall insure a pre-existing deposit during the transition period if the deposit is held by a federal credit union that is a member institution and

  • (a) is repayable on a fixed day that is more than five years after the deposit was made with the local cooperative credit society that was continued as a federal credit union; and

  • (b) would have been guaranteed or insured under the law of a province if the local cooperative credit society had not been continued as a federal credit union.

• Marginal note:Deemed separate deposit

  (4) During the transition period, a pre-existing deposit, less any withdrawals from the pre-existing deposit, is deemed, for the purposes of deposit insurance with the Corporation, to be a deposit separate from any deposit made on or after the continuation day.

• Marginal note:Deemed withdrawal from pre-existing deposit

  (5) During the transition period, any withdrawal — up to the amount of the pre-existing deposit — is deemed, for the purposes of deposit insurance with the Corporation, to be withdrawn from the pre-existing deposit.

Marginal note:Deposits with amalgamating institutions

• 13 (1) When a person has deposits with two or more member institutions that amalgamate and continue in operation as one member institution, in this section referred to as the “amalgamated institution”, a deposit of that person with an amalgamating institution on the day on which the amalgamated institution is formed, less any withdrawals from the deposit, shall, for the purposes of deposit insurance with the Corporation, be deemed to be and continue to be separate from any deposit of that person on that day with the other amalgamating institution or institutions that become part of the amalgamated institution for a period of two years or, in the case of a term deposit with a remaining term exceeding two years, to the maturity of the term deposit.

• Marginal note:Deposits with amalgamated institution

  (2) A deposit made by a person referred to in subsection (1) with an amalgamated institution after the day on which the amalgamated institution is formed shall be insured by the Corporation only to the extent that the aggregate of that person’s deposits with the amalgamated institution, exclusive of the deposit in respect of which the calculation is made, is less than one hundred thousand dollars.

• Marginal note:Exception

  (2.1) A deposit that is insured under subsection 12.1(2) is not to be taken into account when calculating the aggregate of a person’s deposits under subsection (2).

• Marginal note:Where assets acquired

  (3) For the purpose of deposit insurance with the Corporation, if a member institution assumes deposit liabilities of another member institution, those member institutions are deemed to be amalgamating institutions and subsections (1) to (2.1) apply if a person has deposits with both institutions.

• Marginal note:Deemed deposits

  (4) Where a member institution assumes deposit liabilities of another member institution, the deposits in respect of those liabilities are, for the purposes of sections 21, 23 and 25.1, deemed to be deposited with the member institution that assumes them as of the day on which they are assumed.

• Marginal note:Deemed withdrawal from deposit

  (5) During the period referred to in subsection (1), any withdrawal by a person — up to the total amount, on the day on which the amalgamated institution is formed, of that person’s deposits with the two or more member institutions that amalgamate — shall, for the purposes of deposit insurance with the Corporation, be deemed to be withdrawn from those deposits.

Marginal note:Obligation regarding insured amount

• 14 (1) As soon as possible after the Corporation is obliged to make payment in respect of a deposit insured by deposit insurance, it shall make available to the person that in its opinion appears to be entitled to be paid in respect of the deposit an amount of money equal to so much of the person’s deposit as is insured by the Corporation.

• Marginal note:Inability to form opinion

  (1.01) The Corporation shall not make any money available under subsection (1) to a nominee broker or a professional trustee in relation to a trust deposit if information that the Corporation has requested under paragraph 7(1)(b) of the schedule or paragraph 11(b) of the schedule, as the case may be, has not been provided in relation to that deposit.

• Marginal note:How amount to be made available

  (1.1) The amount is to be made available by making a monetary payment to the person or a deposit to the credit of the person at another member institution, whether or not the person has an account at that institution. The Corporation may make the amount available in more than one instalment if, in its opinion, it is appropriate to do so.

• Marginal note:Obligatory payment

  (2) The Corporation shall, in the manner described in subsection (1.1), make payment in respect of any deposit insured by deposit insurance if a winding-up order has been made in respect of the member institution that holds the deposit.

• Marginal note:Discretionary payment

  (2.1) The Corporation may, in the manner described in subsection (1.1), make payment in respect of any deposit insured by deposit insurance if

  • (a) the member institution that holds the deposit is unable, by reason of an order of a court or of any action taken by a supervisory or regulatory body, to make any payment in respect of the deposit;

  • (b) the policy of deposit insurance of the member institution that holds the deposit is terminated or cancelled; or

  • (c) an order is made in respect of the federal member institution under subsection 39.13(1).

• (2.2) [Repealed, 1996, c. 6, s. 26]

• Marginal note:How interest on deposit to be calculated

  (2.3) For the purpose of calculating the payment of the Corporation in respect of any deposit insured by deposit insurance where a winding-up order has been made in respect of the member institution that holds the deposit, the interest accruing and payable in relation to the deposit shall be included only to the date of the commencement of the winding-up.

• Marginal note:Corporation may pay interest

  (2.4) Where the Corporation makes a payment pursuant to subsection (2), the Corporation may pay, in addition to the amount the Corporation is obliged to pay, interest on that amount at a rate determined in accordance with rules prescribed by the by-laws for the period commencing on the date of the commencement of the winding-up in respect of the member institution that holds the deposit and ending on the date of the making of the payment in respect of the deposit, but the aggregate of the payments made under this subsection and subsection (2) in relation to the deposit shall in no case exceed one hundred thousand dollars.

• Marginal note:How interest and deposit to be calculated

  (2.5) For the purpose of calculating the payment of the Corporation in respect of any deposit insured by deposit insurance where the Corporation makes a payment pursuant to subsection (2.1),

  • (a) subject to paragraph (b), the interest accruing and payable in relation to the deposit shall be included only to the date of the payment by the Corporation; or

  • (b) if a proceeding for the winding-up of the member institution that holds the deposit has been commenced before the date of the payment by the Corporation but a winding-up order has not yet been made, the interest accruing and payable in relation to the deposit shall be included only to the date of the commencement of the winding-up.

• Marginal note:Interest on index-linked deposits

  (2.51) The interest referred to in subsection (2.3) or (2.5) in relation to a deposit held by a member institution shall be determined in accordance with rules prescribed by the by-laws if a payment to be made by the member institution in respect of the deposit is to be determined, in whole or in part, by reference in any way to

  • (a) the market price of a security, commodity or financial instrument;

  • (b) the exchange rate between any two currencies;

  • (c) a reference rate determined by reference to any one or more of those prices or rates; or

  • (d) any other kind of variable index or reference point that may be described in rules prescribed by the by-laws.

• Marginal note:Exception

  (2.6) Where a winding-up order is made in respect of a member institution, subsection (2) does not apply to any deposit in respect of which payment was made pursuant to subsection (2.1).

• Marginal note:Preparatory examination

  (2.7) If the Corporation believes that it would be in the best interests of both the depositors with the member institution and the Corporation that preparations be made to make a payment under this Act in respect of a deposit held by a member institution, the Corporation may make or cause to be made by any person designated by the Corporation, an examination of the books, records and accounts of the member institution relating to its deposit liabilities. For the purposes of the examination, the Corporation and the person designated by it have a right of access to those books, records and accounts and are entitled to require the member institution’s directors, officers, auditors and any receiver or liquidator of the member institution to furnish any information and explanations regarding the deposits held by the member institution that the Corporation or person may require.

• Marginal note:Costs of examination

  (2.8) The costs incurred by the Corporation in carrying out an examination in respect of a member institution under subsection (2.7) shall be paid by the member institution and may be recovered by the Corporation as a debt due and payable to the Corporation.

• Marginal note:Date of computing liability

  (2.9) For the purposes of calculating the payment to be made by the Corporation in respect of any deposit insured by deposit insurance, the amount of the deposit shall be determined, where the Corporation makes a payment pursuant to

  • (a) subsection (2), as of the date of the commencement of the winding-up;

  • (b) subsection (2.1) in the winding-up circumstances described in paragraph (2.5)(b), as of the date of the commencement of the winding-up; or

  • (c) subsection (2.1), otherwise than in the winding-up circumstances described in paragraph (2.5)(b), as of the date on which any of the circumstances described in subsection (2.1) first occurs in respect of the member institution concerned.

• Marginal note:Posting requirement

  (2.91) For the purposes of calculating the payment to be made by the Corporation in respect of any deposit insured by deposit insurance, the deposit, other than accrued interest, must be posted in the member institution’s records in accordance with the member institution’s regular transaction posting process as of the applicable date referred to in subsection (2.9).

• Marginal note:Foreign currency exchange

  (2.92) For the purposes of calculating the payment to be made by the Corporation in respect of any deposit payable in a foreign currency that is insured by deposit insurance, the amount of the deposit must be determined in Canadian currency in accordance with the Bank of Canada’s published exchange rate on the applicable date referred to in subsection (2.9) or, if there is no such published rate, the last exchange rate published by the member institution before that applicable date.

• Marginal note:Discharge of liability

  (3) Payment under this section by the Corporation in respect of any deposit insured by deposit insurance discharges the Corporation from all liability to the extent of the amount of the payment made in respect of that deposit, and in no case is the Corporation under any obligation to see to the proper application in any way of the payment so made.

• Marginal note:Subrogation

  (4) Where the Corporation makes a payment under this section in respect of any deposit with a member institution, the Corporation is subrogated, to the extent of the amount of the payment made, to all the rights and interests of the depositor and may maintain an action in respect of those rights and interests in the name of the depositor or in the name of the Corporation.

• Marginal note:Subrogation — returned payment

  (4.01) In the case of a returned payment, at the expiry of one year from the applicable date referred to in subsection (2.9), the Corporation is subrogated, to the extent of the amount of the returned payment, to all the rights and interests of the depositor and may maintain an action in respect of those rights and interests in the name of the depositor or in the name of the Corporation.

• Marginal note:Priority

  (4.1) If the Corporation is subrogated to the rights and interests of a depositor under subsection (4) or (4.01) in respect of any deposit with a member institution that is being wound up, the Corporation ranks,

  • (a) to the extent that the payment was made under subsection (2) or (2.1), including in the case of a returned payment, equally with the depositor in respect of their deposit; and

  • (b) to the extent that the payment includes any interest paid under subsection (2.4), equally with the depositor in respect of interest accruing and payable on their deposit after the date of the making of the winding-up order.

• Marginal note:No set-off or compensation

  (4.2) Despite section 73 of the Winding-up and Restructuring Act, if the Corporation makes a payment under this section in respect of any deposit with a member institution, the law of set-off or compensation does not apply to a claim by the Corporation on the estate of the member institution in respect of that payment.

• Marginal note:Assignment

  (5) Where the Corporation deems it advisable, it may withhold payment in respect of any deposit with a member institution until it has received an assignment in writing of all the rights and interests of the depositor in relation to the deposit.

• Marginal note:Time limitation for claims

  (6) No action may be taken against the Corporation in respect of the obligation of the Corporation to make a payment in relation to a deposit held by a member institution that is being wound up unless the action is commenced within ten years after the date of the commencement of the winding-up.

• Marginal note:Interpretation

  (7) In this section, commencement of the winding-up means the time a winding-up is deemed to commence pursuant to section 5 of the Winding-up and Restructuring Act.