Marginal note:Restriction on securities activities
415. A bank shall not deal in Canada in securities to the extent prohibited or restricted by such regulations as the Governor in Council may make for the purposes of this section.
415.1 (1) It is prohibited for a bank to issue a debt obligation in relation to which the amounts of principal and interest owing are guaranteed to be paid from loans or other assets held by an entity that is created and organized for the principal purpose of holding those loans or other assets and with the intention of legally isolating those loans or other assets from the bank, unless
(a) the debt obligation is a covered bond as defined in section 21.5 of the National Housing Act;
(b) the bank is a registered issuer as defined in section 21.5 of that Act other than one whose right to issue covered bonds has been suspended; and
(c) the debt obligation is issued under a registered program as defined in section 21.5 of that Act.
(2) The Governor in Council may make regulations exempting any type of debt obligation from the application of subsection (1).
- 2012, c. 19, s. 362.
Marginal note:Restriction on insurance business
416. (1) A bank shall not undertake the business of insurance except to the extent permitted by this Act or the regulations.
Marginal note:Restriction on acting as agent
(2) A bank shall not act in Canada as agent for any person in the placing of insurance and shall not lease or provide space in any branch in Canada of the bank to any person engaged in the placing of insurance.
(3) The Governor in Council may make regulations respecting the matters referred to in subsection (1) and regulations respecting relations between banks and
(a) entities that undertake the business of insurance; or
(b) insurance agents or insurance brokers.
(4) Nothing in this section precludes a bank from
(a) requiring insurance to be placed by a borrower for the security of the bank; or
(b) obtaining group insurance for its employees or the employees of any bodies corporate in which it has a substantial investment pursuant to section 468.
(5) [Repealed, 1997, c. 15, s. 45]
Definition of “business of insurance”
(6) In this section, “business of insurance” includes
(a) the issuance of any annuity if the liability in respect of the annuity is contingent on the death of a person; and
(b) the issuance of any debt obligation, any of whose terms and conditions are established on the basis of mortality considerations, under which the issuer is obliged to make periodic payments.
- 1991, c. 46, s. 416;
- 1997, c. 15, s. 45;
- 2012, c. 19, s. 206.
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