Assessment of Financial Institutions Regulations, 2017 (SOR/2016-297)

Insurance Companies

Life Companies, Societies, Foreign Life Companies and Foreign Fraternal Benefit Societies

Marginal note:Calculation

7 The base assessment amount for a financial institution that is a life company, a society, a foreign life company or a foreign fraternal benefit society is, for any fiscal year, equal to

• (a) the minimum assessment applicable to the institution, if it is greater than the amount determined by the formula

  A/B × C

  where

  A

  is the capital of the institution in respect of that fiscal year,

  B

  is the aggregate of the amounts determined for A for all life companies, societies, foreign life companies and foreign fraternal benefit societies, other than those referred to in subsection 2(2), and

  C

  is the amount by which the amount of expenses, ascertained under subsection 23(1) of the Act, incurred for or in connection with the administration of the Insurance Companies Act and attributable to life companies, societies, foreign life companies and foreign fraternal benefit societies in respect of that fiscal year exceeds the total of any service charges, assessment surcharges and other revenues relating to the administration of that Act and attributable to those institutions in respect of that fiscal year; or

• (b) in any other case, the aggregate of the minimum assessment and the amount determined by the formula

  D/E × (C - F)

  where

  C

  is as described in paragraph (a),

  D

  is the amount by which the amount determined by the formula in paragraph (a) exceeds the minimum assessment applicable to the institution in respect of that fiscal year,

  E

  is the aggregate of the amounts determined for D for all life companies, societies, foreign life companies and foreign fraternal benefit societies, other than those referred to in subsection 2(2), and

  F

  is the aggregate of the minimum assessments applicable to all life companies, societies, foreign life companies and foreign fraternal benefit societies, other than those referred to in subsection 2(2).

Property and Casualty Insurers

Marginal note:Calculation

8 The base assessment amount for a financial institution that is a property and casualty insurer is, for any fiscal year, equal to

• (a) the minimum assessment applicable to the institution, if it is greater than the amount determined by the formula

  A/B × C

  where

  A

  is the capital of the institution in respect of that fiscal year,

  B

  is the aggregate of the amounts determined for A for all property and casualty insurers, other than those referred to in subsection 2(2), and

  C

  is the amount by which the amount of expenses, ascertained under subsection 23(1) of the Act, incurred for or in connection with the administration of the Insurance Companies Act and the Green Shield Canada Act and attributable to property and casualty insurers in respect of that fiscal year exceeds the total of any service charges, assessment surcharges and other revenues relating to the administration of those Acts and attributable to those institutions in respect of that fiscal year; or

• (b) in any other case, the aggregate of the minimum assessment and the amount determined by the formula

  D/E × (C - F)

  where

  C

  is as described in paragraph (a),

  D

  is the amount by which the amount determined by the formula in paragraph (a) exceeds the minimum assessment applicable to the institution in respect of that fiscal year,

  E

  is the aggregate of the amounts determined for D for all property and casualty insurers, other than those referred to in subsection 2(2), and

  F

  is the aggregate of the minimum assessments applicable to all property and casualty insurers, other than those referred to in subsection 2(2).

Mortgage Insurance Companies

Marginal note:Calculation

• 9 (1) Subject to subsection (2), the base assessment amount for a financial institution that is a mortgage insurance company is, for any fiscal year, equal to

  • (a) the minimum assessment applicable to the institution, if it is greater than the amount determined by the formula

    A/B × C

    where

    A

    is the capital of the institution in respect of that fiscal year,

    B

    is the aggregate of the amounts determined for A for all mortgage insurance companies, other than those referred to in subsection 2(2), and

    C

    is the amount by which the amount of expenses, ascertained under subsection 23(1) of the Act, incurred for or in connection with the administration of the Insurance Companies Act and attributable to mortgage insurance companies in respect of that fiscal year exceeds the total of any service charges, assessment surcharges and other revenues relating to the administration of that Act and attributable to those institutions in respect of that fiscal year; or

  • (b) in any other case, the aggregate of the minimum assessment and the amount determined by the formula

    D/E × (C - F)

    where

    C

    is as described in paragraph (a),

    D

    is the amount by which the amount determined by the formula in paragraph (a) exceeds the minimum assessment applicable to the institution in respect of that fiscal year,

    E

    is the aggregate of the amounts determined for D for all mortgage insurance companies, other than those referred to in subsection 2(2), and

    F

    is the aggregate of the minimum assessments applicable to all mortgage insurance companies, other than those referred to in subsection 2(2).

• Marginal note:Exception — approved mortgage insurers

  (2) The base assessment amount for a financial institution that is an approved mortgage insurer is, for any fiscal year, equal to the aggregate of the amount determined under subsection (1) and the amount determined by the formula

  A/B × C

  where

  A

  is the capital of the institution in respect of that fiscal year;

  B

  is the aggregate of the amounts determined for A for all approved mortgage insurers, other than those referred to in subsection 2(2); and

  C

  the amount of expenses, ascertained under subsection 23(1) of the Act, incurred for or in connection with the administration of the Protection of Residential Mortgage or Hypothecary Insurance Act in respect of that fiscal year.

Assessment Surcharge

Marginal note:Stage rating assigned

• 10 (1) Subject to subsections (2) and (4), the amount of the surcharge to be assessed for any fiscal year in respect of a financial institution that has been assigned a stage rating in accordance with the Office’s guides to intervention for federally regulated financial institutions is equal to the aggregate of

  • (a) for each month during which the institution was rated at stage 1, the aggregate of $3,000 and an amount equal to 1/12 of 10% of its base assessment amount for the preceding fiscal year; and

  • (b) for each month during which the institution was rated at stage 2, stage 3 or stage 4, the aggregate of $5,000 and an amount equal to 1/12 of 15% of its base assessment amount for the preceding fiscal year.

• Marginal note:Affiliates

  (2) Subject to subsection (4), the amount of the surcharge to be assessed for any fiscal year in respect of a financial institution that has been assigned a stage rating for the sole reason that it is an affiliate within the meaning of section 2 of the Bank Act of another financial institution that has also been assigned a stage rating is equal to the aggregate of

  • (a) for each month during which the institution was rated at stage 1, an amount equal to 1/12 of 10% of its base assessment amount for the preceding fiscal year; and

  • (b) for each month during which the institution was rated at stage 2, stage 3 or stage 4, an amount equal to 1/12 of 15% of its base assessment amount for the preceding fiscal year.

• Marginal note:If no base assessment

  (3) If no base assessment was made against a financial institution for the preceding fiscal year, the surcharge referred to in subsection (1) or (2) is to be calculated using the minimum assessment that would have been applicable to that institution for that year.

• Marginal note:Maximum

  (4) The amount of the surcharge to be assessed for any fiscal year in respect of a financial institution must not exceed an amount equal to

  • (a) in the case of a surcharge referred to in paragraph (1)(a) or (2)(a), 0.2% of the assets of the institution as reported during the preceding fiscal year in the financial or annual return referred to in paragraphs 4(a) to (e); and

  • (b) in the case of a surcharge referred to in paragraph (1)(b) or (2)(b), 0.4% of the assets of the institution as reported during the preceding fiscal year in the financial or annual return referred to in paragraphs 4(a) to (e).

• Marginal note:Multiple stage ratings

  (5) The maximum amount referred to in paragraph (4)(b) is to be applied if a financial institution was assigned more than one stage rating during a fiscal year.

Notice of Assessment

Marginal note:Written notice

11 The Superintendent must send to each financial institution a notice in writing of the assessment against it.

Repeal

12 [Repeal]

Coming into Force

Marginal note:April 1, 2017

13 These Regulations come into force on April 1, 2017.