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Under provincial regulation, a credit union is subject to provincial legislation and regulation by BC Financial Services Authority (“BCFSA”). This places limits on the credit union’s ability to operate in other Canadian jurisdictions. Under current legislation, a provincial credit union may apply to continue (or move) to federal regulation under the federal Bank Act and the federal regulator, the Office of the Superintendent of Financial Institutions (“OSFI”). Once consent and approval have been granted at the provincial and federal levels respectively, the former provincial credit union becomes a federal or national financial institution. This change will allow it to operate across Canada.
The technical term to describe transferring a credit unions’ incorporation from one jurisdiction to another is “continuance”. When a B.C. credit union transfers to federal jurisdiction, that credit union is no longer a B.C. credit union and becomes a federal credit union recognized under the Bank Act, and thereafter is subject to all applicable federal laws.
Before a B.C. credit union can transfer into federal jurisdiction, the credit union must first:
- Obtain approval of its members through a formal vote;
- Provide a complete application to the provincial regulator for consent;
- Receive consent from the Superintendent of Financial Institutions (“Superintendent”) and from the Credit Union Deposit Insurance Corporation of British Columbia (“CUDIC”); and
- Receive federal approval to continue to the federal jurisdiction.
This process can take an extended period of time to complete, depending on the size of the credit union and the complexity of its operations. Read the corresponding regulatory statement for more information about the application process.
A B.C. credit union requires the consent of the Superintendent of Financial Institutions and CUDIC before it can apply to the federal regulator to become a federal credit union.
While it reviews an application from a credit union for “continuance”, BCFSA will seek comment from the public during a 30-day consultation period. Once BCFSA has completed the consent review process, a public notice with the decision will be posted at www.bcfsa.ca.
A review of an application for consent can take up to six months once a formal and complete application has been received. However, the process could take longer depending on the size of the credit union and the complexity of its operations.
No. However, an approval allowing a provincial credit union to transfer into the federal jurisdiction could be subject to conditions set by the provincial regulator.
Yes. In November 2018, Coast Capital Savings Credit Union, a B.C. based credit union, left the provincial jurisdiction to continue into the federal regime.
A membership vote was held in November 2021, and the membership approved the resolution that authorizes the credit union to submit an application to provincial and federal regulators. In December 2021, First West Credit Union submitted an application to the Superintendent and CUDIC for consent. BCFSA staff has acknowledged receipt of the application and has started the process of reviewing the application.
Members may seek to comment directly to the management and board of their credit union through the usual channels of corporate governance. Furthermore, members of the applying credit union may wish to submit comments to BCFSA as part of the application consultation process.
The move of First West Credit Union from provincial regulation to federal regulation may impact the B.C. credit union system, the public, and other businesses. BCFSA seeks public comment to enable an informed decision.
The public may submit comments by e-mail from February 1 to March 2, 2022. You can find out more about the process here: https://www.bcfsa.ca/about-us/who-we-are/stakeholders
You can send your comments to BCFSA:
- By email: [email protected]
Please note that comments submitted will be subject to the rights and protections under the Freedom of Information and Protection of Privacy Act.
Submissions should reach BCFSA by March 2, 2022.
Once the Superintendent and CUDIC have completed the consent review process, a public notice of their decisions will be posted on the BCFSA website: www.bcfsa.ca.