1997 FINANCIAL INSTITUTION REFORM
LOWERING THE BARRIERS TO FOREIGN BANKS
Report of the Standing Senate Committee on Banking, Trade and Commerce
Chairman : The Honourable Michael Kirby
Deputy Chairman : The Honourable W. David Angus
October 1996
TABLE OF CONTENTS
CHAPTER 2: Foreign Financial Institutions Policy
The Foreign Bank Issue: An Introduction
Objectives of Foreign Financial Institutions Policy
The Current Situation with Respect to Foreign Banks
Definition of Terms to be Used in the Report
PART II: WHITE PAPER PROPOSALS
The White Paper Deposit Insurance Opt-Out Proposal
The White Paper Foreign Bank Policy Proposals
Impact of the Foreign Bank Entry Proposals on "Near Banks"
Impact of the Proposed Foreign Branch Policy on Other Financial Institutions
Impact of the Policy Proposals on Selected Financial Institutions
A. Finance Companies
B. Financial Service Providers other than Finance Companies
Issues Raised by the Policy Proposals on Foreign "Near Banks"
PART III: FOREIGN BANK BRANCHES AND FOREIGN BANK SUBSIDIARIES
Foreign Branches vs. Foreign Subsidiaries
The American Situation with respect to Branches and Subsidiaries
The Situation in the United Kingdom with respect to Branches and Subsidiaries
PART IV: VIEWS OF THE COMMITTEE ON FOREIGN FINANCIAL INSTITUTIONS POLICY
A: Views of the Committee on the Proposed Retail Funding Restriction
B: Views of the Committee on Foreign Bank Branches and Foreign Bank Subsidiaries
Four Options for Public Policy Dealing with Foreign Banks in Canada
Analysis of the Four Options
Foreign Branching Meets the Objectives of Foreign Financial Institution Policy
Foreign Branching: Prudential Concerns
Steps Required To Implement the Committee's Proposals
Conclusions on the Foreign Bank Issue
Implications of the Committee Proposals for the Nine Specific Cases Described Above
CHAPTER 3: Strengthening consumer protection
PRIVACY PROTECTION
THE COST AND AVAILABILITY OF FINANCIAL SERVICES
TIED SELLING
PREPAYMENT OF MORTGAGES
CHAPTER 4: Corporate Governance
CHAPTER 5: Credit Unions and the White Paper
ORDERS OF REFERENCE
Extract from the Journals of the Senate, Thursday, March 21, 1996:
"The Honourable Senator Graham, on behalf of Senator Kirby, moved:
THAT, the Standing Senate Committee on Banking, Trade and Commerce be authorized
to examine and report upon the present state of the financial system in Canada;
THAT the papers and evidence received and taken on the subject during the First
Session of the Thirty-Fifth Parliament and any other relevant Parliamentary
papers and evidence on the said subject be referred to the Committee;
THAT the Committee be empowered to permit coverage by electronic media of its
public proceedings with the least possible disruption of its hearings; and
THAT the Committee submit its final report no later than December 12, 1996.
The question being put on the motion, it was adopted."
MEMBERSHIP
The Honourable Michael Kirby, Chairman
The Honourable W. David Angus, Deputy Chairman
and
The Honourable Senators:
| Austin, Jack, PC | *Lynch-Staunton (or Berntson, Eric) |
| *Fairbairn, Joyce, PC (or Graham, Alasdair B) | Meighen, Michael Arthur |
| Hervieux-Payette, Céline, PC | Perrault, Raymond, PC |
| Kelleher, James F, PC | Simard, Jean-Maurice |
| Kenny, Colin | St Germain, Gerry, PC |
| Kolber, E Leo | Stewart, John B |
*Ex Officio Members
Note: The Honourable Senators Poulin and Taylor were also present at
various stages during the course of this study.
Clerk of the Committee