On August 11, 2017, OSFI issued an Industry Notice suspending its advisory on the use of the words “bank”, “banker” and “banking” (the “Advisory”) published just weeks earlier. Our article discussed the implications of the advisory, which can be found here.
The suspension follows the Department of Finance’s release of its consultation paper Potential Policy Measures to Support a Strong and Growing Economy: Positioning Canada’s Financial Sector for the Future. It is the second consultation paper in the Department’s review of the federal financial sector framework. The Department is seeking comments on whether provincially regulated non-bank deposit financial institutions should be allowed to use the terms “bank” or “banking” to describe their activities and services, among other issues. The paper mentions that credit unions believe that the Advisory puts them at a competitive disadvantage to banks while they recognize that limitations on the use of banking words is required to ensure appropriate disclosure to consumers and to mitigate marketplace confusion.
We will stay tuned. The consultation period closes on September 29, 2017.