839. (1) The financial year of a bank holding company ends, at the election of the bank holding company in its by-laws, on the expiration of the thirty-first day of October of each year or the thirty-first day of December of each year.

(2) If, in any year, a bank holding company comes into existence after the first day of July, its first financial year ends, at its election in its by-laws, on the expiration of the thirty-first day of October or the thirty-first day of December in the next calendar year.

2001, c. 9, s. 183.

840. (1) The directors of a bank holding company shall place before the shareholders at every annual meeting

(a) a comparative annual financial statement (in this Part referred to as an “annual statement”) relating separately to

(i) the financial year immediately preceding the meeting, and

(ii) the financial year, if any, immediately preceding the financial year referred to in subparagraph (i);

(b) the report of the auditor of the bank holding company; and

(c) any further information respecting the financial position of the bank holding company and the results of its operations required by the by-laws of the bank holding company to be placed before the shareholders at the annual meeting.

(2) An annual statement of a bank holding company must contain, with respect to each of the financial years to which it relates,

(a) a balance sheet as at the end of the financial year,

(b) a statement of income for the financial year,

(c) a statement of change of financial position for the financial year, and

(d) a statement of changes in shareholders’ equity for the financial year,

showing such information and particulars as in the opinion of the directors are necessary to present fairly, in accordance with the accounting principles referred to in subsection (4), the financial position of the bank holding company as at the end of the financial year to which it relates and the results of the operations and changes in the financial position of the bank holding company for that financial year.

(3) A bank holding company shall include with its annual statement

(a) a list of the subsidiaries of the bank holding company, other than subsidiaries that are not required to be listed by the regulations and subsidiaries acquired pursuant to section 934 or pursuant to a realization of security in accordance with section 935 and which the bank holding company would not otherwise be permitted to hold, showing, with respect to each subsidiary,

(i) its name and the address of its head or principal office,

(ii) the book value of the aggregate of any shares of the subsidiary beneficially owned by the bank holding company and by other subsidiaries of the bank holding company, and

(iii) the percentage of the voting rights attached to all the outstanding voting shares of the subsidiary that is carried by the aggregate of any voting shares of the subsidiary beneficially owned by the bank holding company and by other subsidiaries of the bank holding company; and

(b) such other information as the Governor in Council may, by order, require in such form as may be prescribed.

(4) The financial statements referred to in subsection (1), paragraph (3)(b) and subsection 842(1) shall, except as otherwise specified by the Superintendent, be prepared in accordance with generally accepted accounting principles, the primary source of which is the Handbook of the Canadian Institute of Chartered Accountants. A reference in any provision of this Act to the accounting principles referred to in this subsection shall be construed as a reference to those generally accepted accounting principles with any specifications so made.

(5) The Governor in Council may make regulations respecting subsidiaries that are not required to be listed for the purposes of paragraph (3)(a).

2001, c. 9, s. 183.

841. (1) The directors of a bank holding company shall approve the annual statement and their approval shall be evidenced by the signature or a printed or otherwise mechanically reproduced facsimile of the signature of

(a) the chief executive officer or, in the event of that officer’s absence or inability to act, any other officer of the bank holding company authorized by the directors to sign in the stead of the chief executive officer; and

(b) one director, if the signature required by paragraph (a) is that of a director, or two directors if the signature required by that paragraph is that of an officer who is not a director.

(2) A bank holding company shall not publish copies of an annual statement unless it is approved and signed in accordance with subsection (1).

2001, c. 9, s. 183; 2005, c. 54, s. 127.

842. (1) A bank holding company shall keep at its head office a copy of the current financial statements of each subsidiary of the bank holding company.

(2) Subject to this section, the shareholders of a bank holding company and their personal representatives may, on request therefor, examine the statements referred to in subsection (1) during the usual business hours of the bank holding company and may take extracts therefrom free of charge.

(3) A bank holding company may refuse to permit an examination under subsection (2) by any person.

(4) Within fifteen days after a refusal under subsection (3), the bank holding company shall apply to a court for an order barring the right of the person concerned to make an examination under subsection (2) and the court shall either order the bank holding company to permit the examination or, if it is satisfied that the examination would be detrimental to the bank holding company or to any other body corporate the financial statements of which would be subject to examination, bar the right and make any further order it thinks fit.

(5) A bank holding company shall give the Superintendent and the person seeking to examine the statements referred to in subsection (1) notice of an application to a court under subsection (4), and the Superintendent and the person may appear and be heard in person or by counsel at the hearing of the application.

2001, c. 9, s. 183.

843. (1) A bank holding company shall, not later than twenty-one days before the date of each annual meeting or before the signing of a resolution under paragraph 741(1)(b) in lieu of the annual meeting, send to each shareholder at the shareholder’s recorded address a copy of the documents referred to in subsections 840(1) and (3), unless that time period is waived by the shareholder.

(2) A bank holding company is not required to comply with subsection (1) with respect to a shareholder who has informed the bank holding company, in writing, that the shareholder does not wish to receive the annual statement.

(3) Where a bank holding company is required to comply with subsection (1) and the bank holding company does not comply with that subsection, the annual meeting at which the documents referred to in that subsection are to be considered shall be adjourned until that subsection has been complied with.

2001, c. 9, s. 183.

844. (1) Subject to subsection (2), a bank holding company shall send to the Superintendent a copy of the documents referred to in subsections 840(1) and (3) not later than twenty-one days before the date of each annual meeting of shareholders of the bank holding company.

(2) If a bank holding company’s shareholders sign a resolution under paragraph 741(1)(b) in lieu of an annual meeting, the bank holding company shall send a copy of the documents referred to in subsections 840(1) and (3) to the Superintendent not later than thirty days after the signing of the resolution.

2001, c. 9, s. 183.

845. The following definitions apply in this section and sections 846 to 864.

“firm of accountants” means a partnership, the members of which are accountants engaged in the practice of accounting, or a body corporate that is incorporated by or under an Act of the legislature of a province and engaged in the practice of accounting.

“member”, in relation to a firm of accountants, means

(a) an accountant who is a partner in a partnership, the members of which are accountants engaged in the practice of accounting; or

(b) an accountant who is an employee of a firm of accountants.

2001, c. 9, s. 183.

846. (1) The shareholders of a bank holding company shall, by ordinary resolution at the first meeting of shareholders and at each succeeding annual meeting, appoint a firm of accountants to be the auditor of the bank holding company until the close of the next annual meeting.

(2) The remuneration of the auditor may be fixed by ordinary resolution of the shareholders but, if not so fixed, shall be fixed by the directors.

2001, c. 9, s. 183.

847. (1) A firm of accountants is qualified to be an auditor of a bank holding company if

(a) two or more members thereof are accountants who

(i) are members in good standing of an institute or association of accountants incorporated by or under an Act of the legislature of a province,

(ii) each have at least five years experience at a senior level in performing audits of a financial institution,

(iii) are ordinarily resident in Canada, and

(iv) are independent of the bank holding company; and

(b) the member of the firm jointly designated by the firm and the bank holding company to conduct the audit of the bank holding company on behalf of the firm is qualified in accordance with paragraph (a).

(2) For the purposes of subsection (1),

(a) independence is a question of fact; and

(b) a member of a firm of accountants is deemed not to be independent of a bank holding company if that member or any other member of the firm of accountants, or if the firm of accountants

(i) is a director or an officer or employee of the bank holding company or of any affiliate of the bank holding company or is a business partner of any director, officer or employee of the bank holding company or of any affiliate of the bank holding company,

(ii) beneficially owns or controls, directly or indirectly, a material interest in the shares of the bank holding company or of any affiliate of the bank holding company, or

(iii) has been a liquidator, trustee in bankruptcy, receiver or receiver and manager of any affiliate of the bank holding company within the two years immediately preceding the firm’s proposed appointment as auditor of the bank holding company, other than an affiliate that is a subsidiary of the bank holding company acquired pursuant to section 934 or through a realization of security pursuant to section 935.

(3) Within fifteen days after appointing a firm of accountants as auditor of a bank holding company, the bank holding company and the firm of accountants shall jointly designate a member of the firm who has the qualifications described in subsection (1) to conduct the audit of the bank holding company on behalf of the firm and the bank holding company shall forthwith notify the Superintendent in writing of the designation.

(4) Where for any reason a member of a firm of accountants designated pursuant to subsection (3) ceases to conduct the audit of the bank holding company, the bank holding company and the firm of accountants may jointly designate another member of the same firm of accountants who has the qualifications described in subsection (1) to conduct the audit of the bank holding company and the bank holding company shall forthwith notify the Superintendent in writing of the designation.

(5) In any case where subsection (4) applies and a designation is not made pursuant to that subsection within thirty days after the designated member ceases to conduct the audit of the bank holding company, there shall be deemed to be a vacancy in the office of auditor of the bank holding company.

2001, c. 9, s. 183.

848. (1) An auditor that ceases to be qualified under section 847 shall resign forthwith after any member of the firm becomes aware that the firm has ceased to be so qualified.

(2) Any interested person may apply to a court for an order declaring that an auditor of a bank holding company has ceased to be qualified under section 847 and declaring the office of auditor to be vacant.

2001, c. 9, s. 183.

849. (1) The shareholders of a bank holding company may, by ordinary resolution at a special meeting, revoke the appointment of an auditor.

(2) The Superintendent may at any time revoke the appointment of an auditor made under subsection (3) or 846(1) or section 851 by notice in writing signed by the Superintendent and sent by registered mail to the auditor and to the bank holding company addressed to the usual place of business of the auditor and the bank holding company.

(3) A vacancy created by the revocation of the appointment of an auditor under subsection (1) may be filled at the meeting at which the appointment was revoked and, if not so filled, shall be filled by the directors under section 851.

2001, c. 9, s. 183.

850. (1) An auditor of a bank holding company ceases to hold office when

(a) the auditor resigns; or

(b) the appointment of the auditor is revoked by the shareholders or the Superintendent.

(2) The resignation of an auditor becomes effective at the time a written resignation is sent to the bank holding company or at the time specified in the resignation, whichever is later.

2001, c. 9, s. 183.

851. (1) Subject to subsection 849(3), where a vacancy occurs in the office of auditor of a bank holding company, the directors shall forthwith fill the vacancy, and the auditor so appointed holds office for the unexpired term of office of the predecessor of that auditor.

(2) Where the directors fail to fill a vacancy in accordance with subsection (1), the Superintendent may fill the vacancy and the auditor so appointed holds office for the unexpired term of office of the predecessor of that auditor.

(3) Where the Superintendent has, pursuant to subsection (2), appointed a firm of accountants to fill a vacancy, the Superintendent shall designate the member of the firm who is to conduct the audit of the bank holding company on behalf of the firm.

2001, c. 9, s. 183.

852. (1) The auditor of a bank holding company is entitled to receive notice of every meeting of shareholders and, at the expense of the bank holding company, to attend and be heard thereat on matters relating to the duties of the auditor.

(2) If a director or shareholder of a bank holding company, whether or not the shareholder is entitled to vote at the meeting, gives written notice, not less than ten days before a meeting of shareholders, to an auditor or former auditor of the bank holding company that the director or shareholder wishes the auditor’s attendance at the meeting, the auditor or former auditor shall attend the meeting at the expense of the bank holding company and answer questions relating to the auditor’s or former auditor’s duties as auditor.

(3) A director or shareholder who gives notice under subsection (2) shall send concurrently a copy of the notice to the bank holding company and the bank holding company shall forthwith send a copy thereof to the Superintendent.

(4) The Superintendent may attend and be heard at any meeting referred to in subsection (2).

2001, c. 9, s. 183.

853. (1) An auditor of a bank holding company that

(a) resigns,

(b) receives a notice or otherwise learns of a meeting of shareholders called for the purpose of revoking the appointment of the auditor, or

(c) receives a notice or otherwise learns of a meeting of directors or shareholders at which another firm of accountants is to be appointed in its stead, whether because of the auditor’s resignation or revocation of appointment or because the auditor’s term of office has expired or is about to expire,

shall submit to the bank holding company and the Superintendent a written statement giving the reasons for the resignation or the reasons why the auditor opposes any proposed action.

(2) Where a bank holding company receives a written statement referred to in subsection (1) that relates to a resignation as a result of a disagreement with the directors or officers of the bank holding company or that relates to a matter referred to in paragraph (1)(b) or (c), the bank holding company shall forthwith send a copy of the statement to each shareholder who is entitled to vote at the annual meeting of shareholders.

2001, c. 9, s. 183.

854. (1) Where an auditor of a bank holding company has resigned or the appointment of an auditor has been revoked, no firm of accountants shall accept an appointment as auditor of the bank holding company or consent to be an auditor of the bank holding company until the firm of accountants has requested and received from the other auditor a written statement of the circumstances and reasons why the other auditor resigned or why, in the other auditor’s opinion, the other auditor’s appointment was revoked.

(2) Notwithstanding subsection (1), a firm of accountants may accept an appointment or consent to be appointed as auditor of a bank holding company if, within fifteen days after a request under that subsection is made, no reply from the other auditor is received.

(3) Unless subsection (2) applies, an appointment as auditor of a bank holding company is void if subsection (1) has not been complied with.

2001, c. 9, s. 183.

855. (1) The auditor of a bank holding company shall make such examination as the auditor considers necessary to enable the auditor to report on the annual statement and on other financial statements required by this Part to be placed before the shareholders, except such annual statements or parts thereof as relate to the period referred to in subparagraph 840(1)(a)(ii).

(2) The examination of the auditor referred to in subsection (1) shall, except as otherwise specified by the Superintendent, be conducted in accordance with generally accepted auditing standards, the primary source of which is the Handbook of the Canadian Institute of Chartered Accountants.

2001, c. 9, s. 183.

856. (1) On the request of the auditor of a bank holding company, the present or former directors, officers, employees or agents of the bank holding company shall, to the extent that such persons are reasonably able to do so,

(a) permit access to such records, assets and security held by the bank holding company or any entity in which the bank holding company has a substantial investment, and

(b) provide such information and explanations

as are, in the opinion of the auditor, necessary to enable the auditor to perform the duties of the auditor of the bank holding company.

(2) On the request of the auditor of a bank holding company, the directors of the bank holding company shall, to the extent that they are reasonably able to do so,

(a) obtain from the present or former directors, officers, employees and agents of any entity in which the bank holding company has a substantial investment the information and explanations that such persons are reasonably able to provide and that are, in the opinion of the auditor, necessary to enable them to perform the duties of the auditor of the bank holding company; and

(b) provide the auditor with the information and explanations so obtained.

(3) A person who in good faith makes an oral or written communication under subsection (1) or (2) shall not be liable in any civil action arising from having made the communication.

2001, c. 9, s. 183.

857. (1) The Superintendent may, in writing, require that the auditor of a bank holding company report to the Superintendent on the extent of the procedures of the auditor in the examination of the annual statement and may, in writing, require that the auditor enlarge or extend the scope of that examination or direct that any other particular procedure be performed in any particular case, and the auditor shall comply with any such requirement of the Superintendent and report to the Superintendent thereon.

(2) The Superintendent may, in writing, require that the auditor of a bank holding company make a particular examination to determine whether any procedures adopted by the bank holding company may be prejudicial to the interests of depositors, policyholders or creditors of any federal financial institution that is affiliated with the bank holding company, or any other examination as, in the Superintendent’s opinion, the public interest may require, and report to the Superintendent thereon.

(3) The Superintendent may direct that a special audit of a bank holding company be made if, in the opinion of the Superintendent, it is so required and may appoint for that purpose a firm of accountants qualified pursuant to subsection 847(1) to be an auditor of the bank holding company.

(4) The expenses entailed by any examination or audit referred to in any of subsections (1) to (3) are payable by the bank holding company on being approved in writing by the Superintendent.

2001, c. 9, s. 183.

858. (1) The auditor shall, not less than twenty-one days before the date of the annual meeting of the shareholders of the bank holding company, make a report in writing to the shareholders on the annual statement referred to in subsection 840(1).

(2) In each report required under subsection (1), the auditor shall state whether, in the opinion of the auditor, the annual statement presents fairly, in accordance with the accounting principles referred to in subsection 840(4), the financial position of the bank holding company as at the end of the financial year to which it relates and the results of the operations and changes in the financial position of the bank holding company for that financial year.

(3) In each report referred to in subsection (2), the auditor shall include such remarks as the auditor considers necessary when

(a) the examination has not been made in accordance with the auditing standards referred to in subsection 855(2);

(b) the annual statement has not been prepared on a basis consistent with that of the preceding financial year; or

(c) the annual statement does not present fairly, in accordance with the accounting principles referred to in subsection 840(4), the financial position of the bank holding company as at the end of the financial year to which it relates or the results of the operations or changes in the financial position of the bank holding company for that financial year.

2001, c. 9, s. 183.

859. (1) The auditor of a bank holding company shall, if required by the shareholders, audit and report to the shareholders on any financial statement submitted by the directors to the shareholders, and the report shall state whether, in the opinion of the auditor, the financial statement presents fairly the information required by the shareholders.

(2) A report of the auditor made under subsection (1) shall be attached to the financial statement to which it relates and a copy of the statement and report shall be sent by the directors to every shareholder and to the Superintendent.

2001, c. 9, s. 183.

860. (1) A bank holding company shall take all necessary steps to ensure that each of its subsidiaries has as its auditor the auditor of the bank holding company.

(2) Subsection (1) applies in the case of a subsidiary that carries on its operations in a country other than Canada unless the laws of that country do not permit the appointment of an auditor of the bank holding company as the auditor of that subsidiary.

(3) Subsection (1) does not apply in respect of any particular subsidiary where the bank holding company, after having consulted its auditor, is of the opinion that the total assets of the subsidiary are not a material part of the total assets of the bank holding company.

2001, c. 9, s. 183.

861. (1) The auditor of a bank holding company is entitled to receive notice of every meeting of the audit committee of the bank holding company and, at the expense of the bank holding company, to attend and be heard at that meeting.

(2) If so requested by a member of the audit committee, the auditor shall attend every meeting of the audit committee held during the member’s term of office.

2001, c. 9, s. 183.

862. (1) The auditor of a bank holding company or a member of the audit committee may call a meeting of the audit committee.

(2) The chief internal auditor of a bank holding company or any officer or employee of the bank holding company acting in a similar capacity shall, at the request of the auditor of the bank holding company and on receipt of reasonable notice, meet with the auditor.

2001, c. 9, s. 183.

863. (1) A director or an officer of a bank holding company shall forthwith notify the audit committee and the auditor of the bank holding company of any error or misstatement of which the director or officer becomes aware in an annual statement or other financial statement on which the auditor or any former auditor has reported.

(2) If the auditor or former auditor of a bank holding company is notified or becomes aware of an error or misstatement in an annual statement or other financial statement on which the auditor reported and in the opinion of the auditor the error or misstatement is material, the auditor or former auditor shall inform each director of the bank holding company accordingly.

(3) When under subsection (2) the auditor or former auditor of a bank holding company informs the directors of an error or misstatement in an annual statement or other financial statement, the directors shall

(a) prepare and issue a revised annual statement or financial statement; or

(b) otherwise inform the shareholders and the Superintendent of the error or misstatement.

2001, c. 9, s. 183.

864. Any oral or written statement or report made under this Part by the auditor or former auditor of a bank holding company has qualified privilege.

2001, c. 9, s. 183.

865. Sections 334 to 338 apply in respect of bank holding companies, subject to the following:

(a) references to “bank” in those sections are to be read as references to “bank holding company”; and

(b) references to “this Act” in those sections are to be read as references to “this Part”.

2001, c. 9, s. 183.

866. For the purposes of subsections 346(1) and 347(1) and (2), sections 348 to 352, subsection 353(1), sections 355 and 357 to 359, subsections 363(3) and (4) and section 368, “court” means a court having jurisdiction in the place where the bank holding company has its head office.

2001, c. 9, s. 183.

867. (1) Subsection (2) and sections 342 to 365, 368 and 868 do not apply to a bank holding company that is an insolvent person or a bankrupt as those terms are defined in subsection 2(1) of the Bankruptcy and Insolvency Act.

(2) Any proceedings taken under this Division to dissolve or to liquidate and dissolve a bank holding company shall be stayed if the bank holding company is at any time found, in a proceeding under the Bankruptcy and Insolvency Act, to be an insolvent person as defined in subsection 2(1) of that Act.

(3) The Winding-up and Restructuring Act does not apply to a bank holding company.

2001, c. 9, s. 183.

868. A liquidator appointed under this Division to wind up the business of a bank holding company shall provide the Superintendent with such information relating to the business and affairs of the bank holding company in such form as the Superintendent requires.

2001, c. 9, s. 183.

869. Sections 342 to 346 apply in respect of bank holding companies, subject to the following:

(a) references to “bank” in those sections are to be read as references to “bank holding company”; and

(b) the reference to “sections 143 and 144” in subsection 343(1) is to be read as a reference to “sections 732 and 733”.

2001, c. 9, s. 183.

870. Sections 347 to 360 apply in respect of bank holding companies, subject to the following:

(a) references to “bank” in those sections are to be read as references to “bank holding company”;

(b) the reference to “subsection 308(1)” in subsection 353(1) is to be read as a reference to “subsection 840(1)”; and

(c) paragraph 354(a) is to be read without reference to “or auditors”.

2001, c. 9, s. 183.

871. Sections 361 to 365 and 368 apply in respect of bank holding companies, subject to the following:

(a) references to “bank” in those sections are to be read as references to “bank holding company”;

(b) references to “this Part” in those sections are to be read as references to “this Division”;

(c) the reference to “section 632” in subsection 362(2) is to be read as a reference to “section 951”;

(d) the reference to “section 366” in section 364 is to be read as a reference to “section 872”; and

(e) the reference to “sections 366 and 367” in section 365 is to be read as a reference to “section 872”.

2001, c. 9, s. 183.

872. (1) On the dissolution of a bank holding company under this Act, the portion of the property distributable to a creditor or shareholder who cannot be found shall be converted into money and paid to the Receiver General.

(2) A payment under subsection (1) is deemed to be in satisfaction of a debt or claim of such creditor or shareholder.

(3) If at any time a person establishes that he or she is entitled to any moneys paid to the Receiver General under this Act, the Receiver General shall pay an equivalent amount to him or her out of the Consolidated Revenue Fund.

2001, c. 9, s. 183.