Citation Bank Act Originally published 1 January 1994 Enacted by Parliament of Canada | Date assented to December 13, 1991 | |
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People also search for Canadian Citizenship Act 1946 | ||
The Bank Act (1991, c. 46) is an Act of the Government of Canada respecting banks and banking.
Contents
History
The Bank Act was originally passed in 1871. The terms of the Act provide for a statutory review of the Act on a regular basis to ensure that legislators update the Act in order that it keep pace with developments in the financial system. Historically this was done on a decennial basis. In 1992 this requirement was changed to every five years. The Act contains a "sunset" clause providing that it and the bank charters provided by it will expire unless the statutory review is conducted every five years. The most recent statutory review of the Act took place in 2012.
Credit unions
In 2010, parliament passed amendments to the Act to allow federal credit unions to exist as a new class of financial institution. Federal credit unions differ from banks in that they are member-owned, democratically controlled and governed by co-operative principles. The Bank Act allows that federal credit unions may either be created by five persons (of which three must be individuals), or through the continuance of one or more credit unions existing within provincial jurisdiction. These provisions came into force at the end of 2012, however no institution has yet to operate under them.
Structure
The Act groups banks in three schedules. Schedule I banks are domestic banks allowed to accept deposits. Schedule II banks are subsidiaries of foreign banks that allowed to accept deposits through branches in Canada. Schedule III banks are foreign banks with certain restrictions upon the banking business they can conduct in Canada.
The Canadian banking industry includes 20 domestic banks, 24 foreign bank subsidiaries and 22 foreign bank branches operating in Canada. The provincial-government-owned Alberta Treasury Branches and Canada's many credit unions are not included in this list.