Canada Gazette, Part I, Volume 151, Number 24: Bank Recapitalization (Bail-in) Issuance Regulations

June 17, 2017

Statutory authority

Bank Act

Sponsoring department

Department of Finance

REGULATORY IMPACT ANALYSIS STATEMENT

For the Regulatory Impact Analysis Statement, see the Bank Recapitalization (Bail-in) Conversion Regulations.

PROPOSED REGULATORY TEXT

Notice is given that the Governor in Council, pursuant to subsection 485(2) (see footnote a), section 485.01 (see footnote b) and subsection 978(1) (see footnote c) of the Bank Act (see footnote d), proposes to make the annexed Bank Recapitalization (Bail-in) Issuance Regulations.

Interested persons may make representations concerning the proposed Regulations within 30 days after the date of publication of this notice. All such representations must cite the Canada Gazette, Part I, and the date of publication of this notice, and be addressed to Manuel Dussault, Senior Chief, Framework Policy Section, Financial Institutions Division, Financial Sector Policy Branch, Department of Finance, 90 Elgin Street, Ottawa, Ontario K1A 0G5 (email: fin.fsreg-regsf.fin@canada.ca).

Ottawa, June 8, 2017

Jurica Čapkun
Assistant Clerk of the Privy Council

Bank Recapitalization (Bail-in) Issuance Regulations

Shares and Liabilities

Prescribed shares and liabilities

1 For the purposes of subsection 485(1.2) and section 485.01 of the Bank Act, the prescribed shares and liabilities are the shares and liabilities that are prescribed under the Bank Recapitalization (Bail-In) Conversion Regulations.

Terms of Issuance

Prescribed liability

2 A domestic systemically important bank must ensure that a prescribed liability issued by the bank includes terms that provide for each of the following:

• (a) the holder of the liability is bound, in respect of that liability, by the Canada Deposit Insurance Corporation Act, including the conversion of the liability into common shares under subsection 39.2(2.3) of that Act and the variation or extinguishment of the liability in consequence, and by the application of the laws of Canada or of a province in respect of the operation of that Act with respect to that liability;
• (b) the holder of the liability attorns to the jurisdiction of courts in Canada with respect to that Act and those laws;
• (c) the terms referred to in paragraphs (a) and (b) are binding on the holder of the liability despite any other terms of the liability, any other law that governs the liability and any other agreement, arrangement or understanding between the parties with respect to the liability.

Prescribed share

3 A domestic systemically important bank must ensure that the terms attached to a prescribed share issued by the bank provide that the share is subject to conversion into common shares under subsection 39.2(2.3) of the Canada Deposit Insurance Corporation Act.

Disclosure

4 A domestic systemically important bank must disclose, in a prospectus, information circular, other offering document or similar document related to a share or liability, that the share or liability is subject to conversion into common shares under subsection 39.2(2.3) of the Canada Deposit Insurance Corporation Act .

Coming into Force

180th day after registration

5 These Regulations come into force on the 180th day after the day on which they are registered.

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