Bank Act (S.C. 1991, c. 46)

Marginal note:Branch of account with respect to deposits

• 578 (1) For the purposes of this Act, the branch of account with respect to a deposit account is

  • (a) the branch the address or name of which appears on the specimen signature card or other signing authority signed by a depositor with respect to the deposit account or that is designated by agreement between the authorized foreign bank and the depositor at the time of opening of the deposit account; or

  • (b) if no branch has been identified or agreed on as provided in paragraph (a), the branch that is designated as the branch of account with respect to the deposit account by the authorized foreign bank by notice in writing to the depositor.

• Marginal note:Where debt payable

  (2) The amount of any debt owing by an authorized foreign bank by reason of a deposit in a deposit account in the authorized foreign bank is payable to the person entitled to the amount only at the branch of account and the person is not entitled to demand payment or to be paid at any other branch of the authorized foreign bank.

• Marginal note:Exception where authorization

  (3) Notwithstanding subsection (2), an authorized foreign bank may permit either occasionally or as a regular practice, the person to whom it is indebted by reason of a deposit in a deposit account in the authorized foreign bank to withdraw money owing by reason of the deposit at a branch of the authorized foreign bank other than the branch of account or to draw cheques or other orders for the payment of the money at a branch other than the branch of account.

• Marginal note:Situs of indebtedness

  (4) The indebtedness of an authorized foreign bank by reason of a deposit in a deposit account in the authorized foreign bank is deemed for all purposes to be situated at the place where the branch of account is situated.

• Marginal note:Non-application of subsection (2)

  (5) Subsection (2) does not apply where the business in Canada of the authorized foreign bank is being wound up under the Winding-up and Restructuring Act.

Marginal note:Effect of writ, etc.

• 579 (1) Subject to subsections (3) and (4), the following documents are binding on property belonging to a person and in the possession of an authorized foreign bank, or on money owing to a person by reason of a deposit account in an authorized foreign bank, only if the document or a notice of it is served at the branch of the authorized foreign bank that has possession of the property or that is the branch of account in respect of the deposit account, as the case may be:

  • (a) a writ or process originating a legal proceeding or issued in or pursuant to a legal proceeding;

  • (b) an order or injunction made by a court;

  • (c) an instrument purporting to assign, perfect or otherwise dispose of an interest in the property or the deposit account; or

  • (d) an enforcement notice in respect of a support order or support provision.

• Marginal note:Notices

  (2) Any notification sent to an authorized foreign bank with respect to a customer of the authorized foreign bank, other than a document referred to in subsection (1) or (3), constitutes notice to the authorized foreign bank and fixes the authorized foreign bank with knowledge of its contents only if sent to and received at the branch of the authorized foreign bank that is the branch of account of an account held in the name of that customer.

• Marginal note:Notices: Minister of National Revenue

  (2.1) Despite subsections (1) and (2), a notice, demand, order or other document issued with respect to a customer of an authorized foreign bank constitutes notice to the authorized foreign bank and fixes the authorized foreign bank with knowledge of its contents and, where applicable, is binding on property belonging to the customer and in the possession of the authorized foreign bank or on money owing to the customer by reason of an account in the authorized foreign bank, if it is sent to the branch of the authorized foreign bank referred to in subsection (1) or (2), an office of the authorized foreign bank referred to in paragraph (3)(a) or any other office agreed to by the authorized foreign bank and the Minister of National Revenue and it relates to

  • (a) the administration of an Act of Parliament by the Minister of National Revenue; or

  • (b) the administration of an Act of the legislature of a province or legislation made by an aboriginal government, where the Minister or the Minister of National Revenue has entered into a tax collection agreement under an Act of Parliament with the government of the province or the aboriginal government.

• Marginal note:Exception

  (3) Subsections (1) and (2) do not apply in respect of an enforcement notice in respect of a support order or support provision if

  • (a) the enforcement notice, accompanied by a written statement containing the information required by the regulations, is served at an office of an authorized foreign bank designated in accordance with the regulations in respect of a province; and

  • (b) the order or provision can be enforced under the laws of that province.

• Marginal note:Time of application

  (4) Subsection (3) does not apply in respect of an enforcement notice in respect of a support order or support provision until the second business day following the day of service referred to in that subsection.

• Marginal note:Regulations

  (5) The Governor in Council may make regulations

  • (a) respecting the designation by an authorized foreign bank, for the purpose of subsection (3), of a place in any province for the service of enforcement notices in respect of support orders and support provisions;

  • (b) prescribing the manner in which an authorized foreign bank shall publicize the locations of designated offices of the authorized foreign bank; and

  • (c) respecting the information that must accompany enforcement notices in respect of support orders and support provisions.

• Marginal note:Definitions

  (6) The following definitions apply in this section.

  designated office

  designated office means a place designated in accordance with regulations made for the purpose of subsection (3). (bureau désigné)

  enforcement notice

  enforcement notice, in respect of a support order or support provision, means a garnishee summons or other instrument issued under the laws of a province for the enforcement of the support order or support provision. (avis d’exécution)

  support order

  support order means an order or judgment or interim order or judgment for family financial support. (ordonnance alimentaire)

  support provision

  support provision means a provision of an agreement relating to the payment of maintenance or family financial support. (disposition alimentaire)

Marginal note:Deemed loan

580 For the purposes of sections 425 to 436, as incorporated by section 555, where an authorized foreign bank accepts a bill of exchange drawn on it and not payable on demand or pays or makes money available for the payment of such a bill of exchange, or issues a guarantee, or otherwise makes a promise to effect a payment, the authorized foreign bank is deemed to lend money or make an advance.

Marginal note:Investment standards

581 An authorized foreign bank shall establish and adhere to investment and lending policies, standards and procedures that a reasonable and prudent person would apply in respect of a portfolio of investments and loans to avoid undue risk of loss and obtain a reasonable return.

Deposit Requirements

Marginal note:Requirement to maintain assets on deposit

• 582 (1) An authorized foreign bank shall maintain on deposit in Canada with a Canadian financial institution approved by the Superintendent unencumbered assets of a type approved by the Superintendent the total value of which determined in accordance with the accounting principles referred to in subsection 308(4) shall equal

  • (a) in the case of an authorized foreign bank that is subject to the restrictions and requirements referred to in subsection 524(2), one hundred thousand dollars; and

  • (b) in any other case, the greater of

    • (i) five million dollars, and

    • (ii) five per cent of the liabilities of the authorized foreign bank in respect of its business in Canada.

• Marginal note:Deposit agreement

  (2) The assets referred to in subsection (1) shall be kept with the Canadian financial institution pursuant to a deposit agreement entered into with the prior approval of the Superintendent.

Financial Year

Marginal note:Financial year

• 583 (1) The financial year of an authorized foreign bank in respect of its business in Canada may end on any of March 31, June 30, September 30 or December 31.

• Marginal note:First financial year

  (2) If the first financial year of an authorized foreign bank would end less than four months after the authorized foreign bank has obtained an order under subsection 534(1) approving the commencement and carrying on of business in Canada, the first financial year of the authorized foreign bank ends on March 31, June 30, September 30 or December 31, as the case may be, in the next calendar year.

Auditors

Interpretation

Marginal note:Definitions

584 In sections 585 to 596, the expressions firm of accountants and member have the meanings assigned to those expressions by section 313.

Appointment

Marginal note:Appointment of auditor

• 585 (1) An authorized foreign bank shall appoint a firm of accountants as auditor for its business in Canada and shall notify the Superintendent in writing of the name and address and date of appointment of the auditor without delay after making the appointment.

• Marginal note:Qualification of auditor

  (2) A firm of accountants is qualified to be an auditor if

  • (a) two or more of its members are accountants who

    • (i) are members in good standing of an institute or association of accountants incorporated by or under an Act of the legislature of a province,

    • (ii) have at least five years experience at a senior level in performing audits of a financial institution,

    • (iii) are ordinarily resident in Canada, and

    • (iv) are independent of the authorized foreign bank; and

  • (b) the member of the firm jointly designated by the firm and the authorized foreign bank to conduct the audit of the authorized foreign bank on behalf of the firm is qualified in accordance with paragraph (a).

• Marginal note:Independence

  (3) For the purposes of subsection (2),

  • (a) independence is a question of fact; and

  • (b) a member of a firm of accountants is deemed not to be independent of an authorized foreign bank if that member, a business partner of that member or the firm of accountants

    • (i) is a business partner, director, officer or employee of the authorized foreign bank or of any affiliate of the authorized foreign bank or is a business partner of any director, officer or employee of the authorized foreign bank or of any affiliate of the authorized foreign bank,

    • (ii) beneficially owns or controls, directly or indirectly, a material interest in the shares of the authorized foreign bank or of any of its affiliates, or

    • (iii) has been a liquidator, trustee in bankruptcy, receiver or receiver and manager of any affiliate of the authorized foreign bank within the two years immediately preceding the proposed appointment of the firm of accountants as auditor, other than an affiliate that is a subsidiary of the authorized foreign bank acquired under section 522.15.

• Marginal note:Business partners

  (3.1) For the purposes of subsection (3), a business partner of a member of a firm of accountants includes

  • (a) another member of the firm; and

  • (b) a shareholder of the firm or of another business partner of the member.

• Marginal note:Notice of designation

  (4) Within 15 days after the appointment of a firm of accountants as auditor, the authorized foreign bank and the firm shall jointly designate a member of the firm who meets the qualifications described in paragraph (2)(a) to conduct an audit under subsection 592(1) on behalf of the firm and the authorized foreign bank shall without delay notify the Superintendent in writing of the designation.

• Marginal note:New designation

  (5) Where for any reason the member designated under subsection (4) to conduct an audit ceases to conduct the audit, the authorized foreign bank and the firm of accountants may jointly designate another member of the same firm who meets the qualifications described in paragraph (2)(a) to conduct the audit and the authorized foreign bank shall without delay notify the Superintendent in writing of the designation.

• Marginal note:Deemed vacancy

  (6) In any case where subsection (5) applies and a designation is not made pursuant to that subsection within thirty days after the designated member ceases to conduct the audit, there shall be deemed to be a vacancy in the office of auditor of the authorized foreign bank.

Marginal note:Disqualification of auditor

• 586 (1) An auditor that ceases to be qualified under subsection 585(2) shall resign without delay after any member of the firm of accountants becomes aware that the firm has ceased to be qualified.

• Marginal note:Disqualification order

  (2) Any interested person may apply to a court for an order declaring that an authorized foreign bank’s auditor has ceased to be qualified under subsection 585(2) and declaring the office of auditor to be vacant.

Marginal note:Revocation of appointment

• 587 (1) An authorized foreign bank may at any time revoke the appointment of its auditor.

• Marginal note:Revocation by Superintendent

  (2) The Superintendent may at any time revoke the appointment of an auditor made under subsection 585(1) or 589(1) by notice in writing signed by the Superintendent and sent by registered mail to the auditor and to the principal officer of the authorized foreign bank addressed to the usual place of business of the auditor and to the principal office of the authorized foreign bank, respectively.

Marginal note:Ceasing to hold office

• 588 (1) An auditor ceases to hold office when

  • (a) the auditor resigns; or

  • (b) the appointment of the auditor is revoked by the authorized foreign bank or the Superintendent.

• Marginal note:Effective date of resignation

  (2) The resignation of an auditor becomes effective at the time a written resignation is sent to the authorized foreign bank or at the time specified in the resignation, whichever is later.