Vol. 149, No. 6 — March 25, 2015

Registration

SOR/2015-57 March 5, 2015

CANADA DEPOSIT INSURANCE CORPORATION ACT

By-law Amending the Canada Deposit Insurance Corporation Data and System Requirements By-law

The Board of Directors of the Canada Deposit Insurance Corporation, pursuant to paragraphs 11(2)(f.1) (see footnote a) and (f.2) (see footnote b) of the Canada Deposit Insurance Corporation Act (see footnote c), makes the annexed By-law Amending the Canada Deposit Insurance Corporation Data and System Requirements By-law.

Ottawa, March 4, 2015

BY-LAW AMENDING THE CANADA DEPOSIT INSURANCE CORPORATION DATA AND SYSTEM REQUIREMENTS BY-LAW

AMENDMENTS

1. (1) The definition “determination time” in subsection 1(1) of the Canada Deposit Insurance Corporation Data and System Requirements By-law (see footnote 1) is replaced by the following:

“determination time”
« heure-repère »

“determination time” means

(2) Subsection 1(1) of the By-law is amended by adding the following in alphabetical order:

“foreign branch”
« succursale étrangère »

“foreign branch” means a branch of a member institution that is located outside Canada.

2. (1) Paragraph 3(1)(b) of the By-law is replaced by the following:

(2) Section 3 of the By-law is amended by adding the following after subsection (1):

Scope of means to identify

(1.1) For the purposes of paragraph (1)(b), the means to identify the deposit liabilities referred to in that paragraph does not include a means to identify the deposit liabilities posted in the records of a foreign branch of the member institution.

3. (1) The portion of subsection 4(1) of the By-law before paragraph (a) is replaced by the following:

Identification of deposit liabilities

4. (1) Subject to subsection (1.1), every member institution must be capable of

(2) Section 4 of the By-law is amended by adding the following after subsection (1):

Scope of capability to identify

(1.1) For the purposes of subsection (1), the capability referred to in paragraphs (1)(a) and (b) does not include the capability to identify the deposit liabilities that are posted in the records of a foreign branch of the member institution.

COMING INTO FORCE

4. This By-law comes into force on the day on which it is registered.

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the By-law.)

Description

The Board of Directors of the Canada Deposit Insurance Corporation (CDIC) made the Canada Deposit Insurance Corporation Data and System Requirements By-law (the By-law) on December 8, 2010. Pursuant to paragraphs 11(2)(f.1) and (f.2) of the Canada Deposit Insurance Corporation Act (the CDIC Act), the CDIC Board of Directors is authorized to make by-laws respecting the information that CDIC can require from member institutions with respect to their deposit liabilities, as well as the time within and manner in which it is to be provided, and respecting the capabilities that CDIC can require member institutions to have, including the capability to identify their deposit liabilities and temporarily prevent withdrawals of deposit liabilities, all with a view to facilitating the Corporation’s exercise of its functions under section 14 of the CDIC Act or in the event that an order is made under subsection 39.13(1) of the CDIC Act. The CDIC Board of Directors is proposing to make the By-law Amending the Canada Deposit Insurance Corporation Data and System Requirements By-law (the Amending By-law) under this authority.

The changes proposed in the Amending By-law are to address information and capability requirements as they apply to those branches of a member institution located outside of Canada (foreign branches). They acknowledge the reality that data collection and systems requirements of a foreign jurisdiction may not be readily compatible with the data and system requirements imposed in the By-law. A foreign branch of a member institution must follow the laws and regulations of the jurisdiction in which it is located, including the way it maintains deposit liability records.

In the circumstances, the amendments noted below are intended to extend the time within which a member institution is required to provide information from its foreign branches in a resolution scenario. Further, the amendments relieve a member institution from providing certain information about deposit liabilities posted at foreign branches and from ensuring that a foreign branch has certain specified capabilities.

The following table provides more detail with respect to each of the proposed amendments:

AMENDING BY-LAW SECTION BY-LAW SECTION EXPLANATION
1(1) 1(1) The definition of “determination time” is amended to provide for a different point in time for the deposit liabilities of a member institution located in a foreign branch of the member institution or posted in the records of the foreign branch.
1(2) 1(1) A “foreign branch” is defined as a branch of a member institution that is located outside Canada.
2(1) and 2(2) 3(1)(b) and new 3(1.1) Relieves a member institution from classifying deposit liabilities posted in the records of its foreign branch by insurability and insurance category.
3(1) and 3(2) 4(1) and new 4(1.1) With respect to a member institution’s deposit liabilities posted in the records of its foreign branch, relieves the member institution (a) from the requirement to have the capability to identify its deposit liabilities by each of its distinct characteristics and group them together by characteristic, and (b) to identify its deposit liabilities in respect of each depositor by each of its distinct characteristics and group them together by characteristic.

Alternatives

There are no available alternatives. The CDIC Act specifically provides that the Corporation can only impose by way of by-law requirements relating to producing information about a member institution’s deposit liabilities and requirements regarding capabilities for the identification of deposit liabilities.

Benefits and costs

There are no costs associated with these amendments. The benefits for member institutions will be to lessen compliance implications for those deposit liabilities located in a foreign branch.

Consultation

In August 2013, member institutions were advised that the CDIC intended to put forward foreign branch amendments to both the By-law and the related Data and System Requirements. The relevant changes to the Data and System Requirements were posted on the CDIC public Web site in March 2014. The only consultation that took place was through prepublication in Part I of the Canada Gazette on October 18, 2014, and it ended on December 17, 2014. As a result, no comments were received.

Compliance and enforcement

There are no compliance or enforcement issues other than as referenced under the section “Benefits and costs” above.

Contact

Sheila Salloum
Director
Insurance
Canada Deposit Insurance Corporation
50 O’Connor Street, 17th Floor
Ottawa, Ontario
K1P 6L2
Telephone: 613-947-0257
Fax: 613-996-6095
Email: ssalloum@cdic.ca