Bank Act (S.C. 1991, c. 46)

Marginal note:Directors filling vacancy

• 765 (1) Despite section 772 but subject to subsection (2) and sections 764 and 766, a quorum of directors may fill a vacancy among the directors except a vacancy resulting from a change in the by-laws by which the number or the minimum or maximum number of directors is increased or from a failure to elect the number or minimum number of directors provided for in the by-laws.

• Marginal note:Where composition fails

  (2) Notwithstanding sections 764 and 772, where by reason of a vacancy the number of directors or the composition of the board of directors fails to meet any of the requirements of section 749 or section 752, the directors who, in the absence of any by-law, would be empowered to fill that vacancy shall do so forthwith.

Marginal note:Class vacancy

766 Notwithstanding section 772, where the holders of any class or series of shares of a bank holding company have an exclusive right to elect one or more directors and a vacancy occurs among those directors, then, subject to section 764,

• (a) the remaining directors elected by the holders of that class or series of shares may fill the vacancy except one resulting from an increase in the number or the minimum or maximum number of directors for that class or series or from a failure to elect the number or minimum number of directors provided for in the by-laws for that class or series;

• (b) if there are no such remaining directors and, by reason of the vacancy, the number of directors or the composition of the board of directors fails to meet any of the requirements of section 749 or section 752, the other directors may fill that vacancy; and

• (c) if there are no such remaining directors and paragraph (b) does not apply, any holder of shares of that class or series may call a meeting of the holders thereof for the purpose of filling the vacancy.

Marginal note:Unexpired term

767 Unless the by-laws otherwise provide, a director elected or appointed to fill a vacancy holds office for the unexpired term of the director’s predecessor in office.

Marginal note:Additional directors

• 768 (1) The directors of a bank holding company may appoint one or more additional directors where the by-laws of the bank holding company allow them to do so and the by-laws determine the minimum and maximum numbers of directors.

• Marginal note:Term of office

  (2) A director appointed under subsection (1) holds office for a term expiring not later than the close of the next annual meeting of shareholders of the bank holding company.

• Marginal note:Limit on number appointed

  (3) The total number of directors appointed under subsection (1) may not exceed one third of the number of directors elected at the previous annual meeting of shareholders of the bank holding company.

Meetings of the Board

Marginal note:Meetings required

• 769 (1) The directors shall meet at least four times during each financial year.

• Marginal note:Place for meetings

  (2) The directors may meet at any place unless the by-laws provide otherwise.

• Marginal note:Notice for meetings

  (3) The notice for the meetings must be given as required by the by-laws.

Marginal note:Notice of meeting

• 770 (1) A notice of a meeting of directors shall specify each matter referred to in section 785 that is to be dealt with at the meeting but, unless the by-laws otherwise provide, need not otherwise specify the purpose of or the business to be transacted at the meeting.

• Marginal note:Waiver of notice

  (2) A director may in any manner waive notice of a meeting of directors and the attendance of a director at a meeting of directors is a waiver of notice of that meeting except where the director attends the meeting for the express purpose of objecting to the transaction of any business on the grounds that the meeting is not lawfully called.

• Marginal note:Adjourned meeting

  (3) Notice of an adjourned meeting of directors is not required to be given if the time and place of the adjourned meeting were announced at the original meeting.

Marginal note:Quorum

• 771 (1) Subject to section 772, the number of directors referred to in subsection (2) constitutes a quorum at any meeting of directors or a committee of directors and, notwithstanding any vacancy among the directors, a quorum of directors may exercise all the powers of the directors.

• Marginal note:Quorum

  (2) The number of directors constituting a quorum at any meeting of directors or a committee of directors shall be

  • (a) a majority of the minimum number of directors required by this Part for the board of directors or a committee of directors; or

  • (b) such greater number of directors than the number calculated pursuant to paragraph (a) as may be established by the by-laws of the bank holding company.

• Marginal note:Director continues to be present

  (3) A director who is present at a meeting of directors or of a committee of directors but is not, in accordance with subsection 790(1), present at any particular time during the meeting is considered to be present for the purposes of this section.

Marginal note:Resident Canadian majority

• 772 (1) The directors of a bank holding company shall not transact business at a meeting of directors unless

  • (a) in the case of a bank holding company that is a subsidiary of a foreign bank, at least one half of the directors present are resident Canadians; or

  • (b) in any other case, a majority of the directors present are resident Canadians.

• Marginal note:Exception

  (2) Despite subsection (1), the directors of a bank holding company may transact business at a meeting of directors without the required proportion of directors who are resident Canadians if

  • (a) a director who is a resident Canadian unable to be present approves, in writing or by telephonic, electronic or other communications facilities, the business transacted at the meeting; and

  • (b) there would have been present the required proportion of directors who are resident Canadians had that director been present at the meeting.

Marginal note:Electronic meeting

• 773 (1) Subject to the by-laws of a bank holding company, a meeting of directors or of a committee of directors may be held by means of such telephonic, electronic or other communications facilities as permit all persons participating in the meeting to communicate adequately with each other during the meeting.

• Marginal note:Deemed present

  (2) A director participating in a meeting by any means referred to in subsection (1) is deemed for the purposes of this Part to be present at that meeting.

Marginal note:Resolution outside board meeting

• 774 (1) A resolution in writing signed by all the directors entitled to vote on that resolution at a meeting of directors is as valid as if it had been passed at a meeting of directors.

• Marginal note:Filing directors’ resolution

  (2) A copy of the resolution referred to in subsection (1) shall be kept with the minutes of the proceedings of the directors.

• Marginal note:Resolution outside committee meeting

  (3) A resolution in writing signed by all the directors entitled to vote on that resolution at a meeting of a committee of directors, other than a resolution of the audit committee in carrying out its duties under subsection 782(3), is as valid as if it had been passed at a meeting of that committee.

• Marginal note:Filing committee resolution

  (4) A copy of the resolution referred to in subsection (3) shall be kept with the minutes of the proceedings of that committee.

• Marginal note:Evidence

  (5) Unless a ballot is demanded, an entry in the minutes of a meeting that the chairperson declared a resolution to be carried or defeated is in the absence of evidence to the contrary proof of that fact without proof of the number or proportion of votes recorded in favour of or against the resolution.

Marginal note:Dissent of director

• 775 (1) A director of a bank holding company who is present at a meeting of directors or a committee of directors is deemed to have consented to any resolution passed or action taken at that meeting unless

  • (a) the director requests that the director’s dissent be entered or the director’s dissent is entered in the minutes of the meeting;

  • (b) the director sends a written dissent to the secretary of the meeting before the meeting is adjourned; or

  • (c) the director sends the director’s dissent by registered mail or delivers it to the head office of the bank holding company immediately after the meeting is adjourned.

• Marginal note:Loss of right to dissent

  (2) A director of a bank holding company who votes for or consents to a resolution is not entitled to dissent under subsection (1).

• Marginal note:Dissent of absent director

  (3) A director of a bank holding company who is not present at a meeting at which a resolution is passed or action taken is deemed to have consented thereto unless, within seven days after the director becomes aware of the resolution, the director

  • (a) causes the director’s dissent to be placed with the minutes of the meeting; or

  • (b) sends the director’s dissent by registered mail or delivers it to the head office of the bank holding company.

Marginal note:Record of attendance

• 776 (1) A bank holding company shall keep a record of the attendance at each meeting of directors and each committee meeting of directors.

• Marginal note:Statement to shareholders

  (2) A bank holding company shall attach to the notice of each annual meeting it sends to its shareholders a statement showing, in respect of the financial year immediately preceding the meeting, the total number of directors’ meetings and directors’ committee meetings held during the financial year and the number of those meetings attended by each director.

Marginal note:Meeting required by Superintendent

• 777 (1) Where in the opinion of the Superintendent it is necessary, the Superintendent may, by notice in writing, require a bank holding company to hold a meeting of directors of the bank holding company to consider the matters set out in the notice.

• Marginal note:Attendance of Superintendent

  (2) The Superintendent may attend and be heard at a meeting referred to in subsection (1).

By-laws

Marginal note:By-laws

• 778 (1) Unless this Part otherwise provides, the directors of a bank holding company may by resolution make, amend or repeal any by-law that regulates the business or affairs of the bank holding company.

• Marginal note:Shareholder approval

  (2) The directors shall submit a by-law, or an amendment to or a repeal of a by-law, that is made under subsection (1) to the shareholders at the next meeting of shareholders, and the shareholders may, by resolution, confirm or amend the by-law, amendment or repeal.

• Marginal note:Effective date of by-law

  (3) Unless this Part otherwise provides, a by-law, or an amendment to or a repeal of a by-law, is effective from the date of the resolution of the directors under subsection (1) until it is confirmed, confirmed as amended or rejected by the shareholders under subsection (2) or until it ceases to be effective under subsection (4) and, where the by-law is confirmed, or confirmed as amended, it continues in effect in the form in which it was so confirmed.

• Marginal note:Effect where no shareholder approval

  (4) If a by-law, or an amendment to or a repeal of a by-law, is rejected by the shareholders, or is not submitted to the shareholders by the directors as required under subsection (2), the by-law, amendment or repeal ceases to be effective from the date of its rejection or the date of the next meeting of shareholders, as the case may be, and no subsequent resolution of the directors to make, amend or repeal a by-law having substantially the same purpose or effect is effective until it is confirmed, or confirmed as amended, by the shareholders.

Marginal note:Shareholder proposal of by-law

779 A shareholder entitled to vote at an annual meeting of shareholders may, in accordance with sections 732 and 733, make a proposal to make, amend or repeal a by-law.

Marginal note:Deemed by-laws

• 780 (1) Any matter that, immediately prior to the day a body corporate is continued as a bank holding company, was provided for in the incorporating instrument of the body corporate, and that, under this Part, would be provided for in the by-laws of a bank holding company, is deemed to be provided for in the by-laws of the bank holding company.

• Marginal note:By-law prevails

  (2) Where a by-law of the bank holding company made in accordance with sections 778 and 779 amends or repeals any matter referred to in subsection (1), the by-law prevails.

Committees of the Board

Marginal note:Committees

781 The directors of a bank holding company may appoint from their number, in addition to the committees referred to in subsection 747(2), such other committees as they deem necessary and, subject to section 785, delegate to those committees such powers of the directors, and assign to those committees such duties, as the directors consider appropriate.

Marginal note:Audit committee

• 782 (1) The audit committee of a bank holding company shall consist of at least three directors.

• Marginal note:Membership

  (2) None of the members of the audit committee may be officers or employees of the bank holding company or any of its subsidiaries.

• Marginal note:Duties of audit committee

  (3) The audit committee of a bank holding company shall

  • (a) review the annual statement of the bank holding company before the annual statement is approved by the directors;

  • (b) review such returns of the bank holding company as the Superintendent may specify;

  • (c) require the management of the bank holding company to implement and maintain appropriate internal control procedures;

  • (d) review, evaluate and approve those procedures;

  • (e) review such investments and transactions that could adversely affect the well-being of the bank holding company as the auditor or any officer of the bank holding company may bring to the attention of the committee;

  • (f) meet with the auditor to discuss the annual statement and the returns and transactions referred to in this subsection; and

  • (g) meet with the chief internal auditor of the bank holding company, or the officer or employee of the bank holding company acting in a similar capacity, and with management of the bank holding company, to discuss the effectiveness of the internal control procedures established for the bank holding company.

• Marginal note:Report

  (4) In the case of the annual statement and returns of a bank holding company that under this Part must be approved by the directors of the bank holding company, the audit committee of the bank holding company shall report thereon to the directors before the approval is given.

• Marginal note:Required meeting of directors

  (5) The audit committee of a bank holding company may call a meeting of the directors of the bank holding company to consider any matter of concern to the committee.