CDIC welcomes changes to the CDIC Act
OTTAWA – June 30, 2021– The Canada Deposit Insurance Corporation (CDIC) welcomes important changes to the CDIC Act resulting from the Budget implementation Act 2021, No.1, which has received Royal Assent.
These new measures promote financial stability by strengthening Canada’s deposit protection and bank resolution regime. Key changes to the CDIC Act include:
- Strengthening the cross-border enforceability of the stay provisions that apply to eligible financial contracts, which will improve CDIC’s ability to resolve a member institution with cross-border operations;
- Providing legislative clarity to ensure beneficiaries of trust deposits continue to be protected once the new requirements related to trust deposits come into force; and
- Extending the time limit for retaining control of a failing bank to 18 months from six months to allow CDIC time to complete its sale or restructuring.
While they are technical in nature, these changes are part of a continuum of policy updates that improve CDIC’s ability to protect depositors, promote financial stability and resolve troubled institutions of all sizes in Canada.
These measures complement recent changes to the deposit insurance framework that expand coverage to include foreign currency and, effective April 2022, the addition of new coverage categories. For more information, visit www.cdic.ca.
CDIC is a federal Crown corporation established in 1967 to protect the savings of Canadians, and we contribute to financial stability by safeguarding close to $1 trillion in deposits at more than 80 member institutions. As resolution authority, we are responsible for handling the failure of any of our members, from the smallest to the largest. Our members include banks, federally regulated credit unions as well as loan and trust companies. We are funded by premiums paid by member institutions and do not receive public funds to operate. We have resolved 43 member failures affecting some two million Canadians. No one has lost a dollar of deposits under CDIC protection.
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Director, Communications and Public Affairs