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Bank Act (S.C. 1991, c. 46)

Full Document:  

Act current to 2020-05-04 and last amended on 2020-04-30. Previous Versions

PART XVBank Holding Companies (continued)

DIVISION 6Corporate Governance (continued)

Directors and Officers (continued)

Marginal note:Shareholder proposal of by-law

 A shareholder entitled to vote at an annual meeting of shareholders may, in accordance with sections 732 and 733, make a proposal to make, amend or repeal a by-law.

  • 2001, c. 9, s. 183

Marginal note:Deemed by-laws

  •  (1) Any matter that, immediately prior to the day a body corporate is continued as a bank holding company, was provided for in the incorporating instrument of the body corporate, and that, under this Part, would be provided for in the by-laws of a bank holding company, is deemed to be provided for in the by-laws of the bank holding company.

  • Marginal note:By-law prevails

    (2) Where a by-law of the bank holding company made in accordance with sections 778 and 779 amends or repeals any matter referred to in subsection (1), the by-law prevails.

  • 2001, c. 9, s. 183
Committees of the Board

Marginal note:Committees

 The directors of a bank holding company may appoint from their number, in addition to the committees referred to in subsection 747(2), such other committees as they deem necessary and, subject to section 785, delegate to those committees such powers of the directors, and assign to those committees such duties, as the directors consider appropriate.

  • 2001, c. 9, s. 183

Marginal note:Audit committee

  •  (1) The audit committee of a bank holding company shall consist of at least three directors.

  • Marginal note:Membership

    (2) None of the members of the audit committee may be officers or employees of the bank holding company or any of its subsidiaries.

  • Marginal note:Duties of audit committee

    (3) The audit committee of a bank holding company shall

    • (a) review the annual statement of the bank holding company before the annual statement is approved by the directors;

    • (b) review such returns of the bank holding company as the Superintendent may specify;

    • (c) require the management of the bank holding company to implement and maintain appropriate internal control procedures;

    • (d) review, evaluate and approve those procedures;

    • (e) review such investments and transactions that could adversely affect the well-being of the bank holding company as the auditor or any officer of the bank holding company may bring to the attention of the committee;

    • (f) meet with the auditor to discuss the annual statement and the returns and transactions referred to in this subsection; and

    • (g) meet with the chief internal auditor of the bank holding company, or the officer or employee of the bank holding company acting in a similar capacity, and with management of the bank holding company, to discuss the effectiveness of the internal control procedures established for the bank holding company.

  • Marginal note:Report

    (4) In the case of the annual statement and returns of a bank holding company that under this Part must be approved by the directors of the bank holding company, the audit committee of the bank holding company shall report thereon to the directors before the approval is given.

  • Marginal note:Required meeting of directors

    (5) The audit committee of a bank holding company may call a meeting of the directors of the bank holding company to consider any matter of concern to the committee.

  • 2001, c. 9, s. 183
Directors and Officers — Authority

Marginal note:Chief executive officer

 The directors of a bank holding company shall appoint from their number a chief executive officer who must be ordinarily resident in Canada and, subject to section 785, may delegate to that officer any of the powers of the directors.

  • 2001, c. 9, s. 183

Marginal note:Appointment of officers

  •  (1) The directors of a bank holding company may, subject to the by-laws, designate the offices of the bank holding company, appoint officers thereto, specify the duties of those officers and delegate to them powers, subject to section 785, to manage the business and affairs of the bank holding company.

  • Marginal note:Directors as officers

    (2) Subject to section 752, a director of a bank holding company may be appointed to any office of the bank holding company.

  • Marginal note:Two or more offices

    (3) Two or more offices of a bank holding company may be held by the same person.

  • 2001, c. 9, s. 183

Marginal note:Limits on power to delegate

 The directors of a bank holding company may not delegate any of the following powers, namely, the power to

  • (a) submit to the shareholders a question or matter requiring the approval of the shareholders;

  • (b) fill a vacancy among the directors, on a committee of directors or in the office of auditor or appoint additional directors;

  • (c) issue or cause to be issued securities, including an issue of shares of a series that is authorized in accordance with section 706, except in accordance with any authorization made by the directors;

  • (d) declare a dividend;

  • (e) authorize the redemption or other acquisition by the bank holding company pursuant to section 715 of shares issued by the bank holding company;

  • (f) authorize the payment of a commission on a share issue;

  • (g) approve a management proxy circular;

  • (h) except as provided in this Part, approve the annual statement of the bank holding company and any other financial statements issued by the bank holding company; or

  • (i) adopt, amend or repeal by-laws.

  • 2001, c. 9, s. 183
  • 2005, c. 54, s. 109

Marginal note:Remuneration of directors, officers and employees

  •  (1) Subject to this section and the by-laws, the directors of a bank holding company may fix the remuneration of the directors, officers and employees of the bank holding company.

  • Marginal note:By-law required

    (2) No remuneration shall be paid to a director as director until a by-law fixing the aggregate of all amounts that may be paid to all directors in respect of directors’ remuneration during a fixed period of time has been confirmed by special resolution.

  • 2001, c. 9, s. 183

Marginal note:Validity of acts

  •  (1) An act of a director or an officer of a bank holding company is valid notwithstanding a defect in the director’s qualification or an irregularity in the director’s election or in the appointment of the director or officer.

  • Marginal note:Validity of acts

    (2) An act of the board of directors of a bank holding company is valid notwithstanding a defect in the composition of the board or an irregularity in the election of the board or in the appointment of a member of the board.

  • 2001, c. 9, s. 183

Marginal note:Right to attend meetings

 A director of a bank holding company is entitled to attend and to be heard at every meeting of shareholders.

  • 2001, c. 9, s. 183
Conflicts of Interest

Marginal note:Disclosure of interest

  •  (1) A director or officer of a bank holding company shall disclose to the bank holding company, in writing or by requesting to have it entered in the minutes of a meeting of directors or a meeting of a committee of directors, the nature and extent of any interest they have in a material contract or material transaction with the bank holding company, whether entered into or proposed, if they

    • (a) are a party to the contract or transaction;

    • (b) are a director or officer of a party to the contract or transaction or a person acting in a similar capacity; or

    • (c) have a material interest in a party to the contract or transaction.

  • Marginal note:Time of disclosure — director

    (2) The disclosure shall be made in the case of a director

    • (a) at the meeting of directors, or of a committee of directors, at which the proposed contract or transaction is first considered;

    • (b) if at the time of the meeting referred to in paragraph (a) the director was not interested in the proposed contract or transaction, at the first one after they become interested in it;

    • (c) if the director becomes interested after a contract or transaction is entered into, at the first one after they become interested; or

    • (d) if a person who is interested in a contract or transaction becomes a director, at the first one after they become a director.

  • Marginal note:Time of disclosure — officer

    (3) The disclosure required by subsection (1) shall be made in the case of an officer who is not a director

    • (a) immediately after they become aware that the contract, transaction, proposed contract or proposed transaction is to be considered or has been considered at a meeting of directors or of a committee of directors;

    • (b) if they become interested after the contract or transaction is entered into, immediately after they become interested; or

    • (c) if a person who is interested in a contract or transaction becomes an officer, immediately after they become an officer.

  • Marginal note:Time of disclosure — contract not requiring approval

    (4) If the material contract or material transaction, whether entered into or proposed, is one that in the ordinary course of the bank holding company’s business would not require approval by the directors or shareholders, the director or officer shall disclose to the bank holding company, in writing or by requesting to have it entered in the minutes of a meeting of directors or of a committee of directors, the nature and extent of their interest immediately after they become aware of the contract or transaction.

  • 2001, c. 9, s. 183
  • 2005, c. 54, s. 110
 
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