Credit Unions and Caisses Populaires Regulation

Credit Unions and Caisses Populaires Regulation, M.R. 73/2022 The Credit Unions and Caisses Populaires Act , C.C.S.M. c. C301 Regulation 73/2022 Registered June 24, 2022 bilingual version (HTML) Table of Contents Section 1 Definitions OPERATIONS OF CREDIT UNIONS 2 Names 3 Changing registered office address 4 Relocating or closing branch offices 5 Concurrent physical meetings 6 Audit committee 7 Financial statements and audit reports 8 Security issue requirements 9 Exemption from securities requirements 10 Payment of prescribed amount on death of a member 11 Unclaimed balances OPERATIONS OF THE CENTRAL 12 Audit committee 13 Financial statements and audit reports 14 Credit committee OPERATIONS OF THE GUARANTEE CORPORATION 15 French services by guarantee corporation 16 Maximum quarterly levy and special assessment on credit unions 17 Oversight fee payable by guarantee corporation OTHER FEES 18 Fees REPEAL AND COMING INTO FORCE 19 Repeal 20 Coming into force Definitions 1 The following definitions apply in this regulation. "Act" means The Credit Unions and Caisses Populaires Act . («  Loi  ») "credit union" , except in subsection 2(2), includes a caisse populaire. (« caisse populaire ») OPERATIONS OF CREDIT UNIONS Names 2(1) The name of a credit union must be distinctive. Distinctiveness is determined by considering the whole name and not its individual elements. 2(2) If a credit union acquires a designated number as part of its name, the complete name must consist of the file number assigned to the credit union by the Registrar followed by the words "CREDIT UNION OF MANITOBA LIMITED". 2(3) If a caisse populaire acquires a designated number as part of its name, the complete name must consist of the file number assigned to the caisse populaire by the Registrar followed by the words "CAISSE POPULAIRE DU MANITOBA LIMITÉE". 2(4) The name of a credit union must not (a) begin with the word "Manitoba"; (b) contain the family name of an individual unless the individual or their heir, successor, executor, administrator or guardian consents to the use of the name; (c) contain a word or an expression that is obscene or objectionable on public grounds; (d) contain a word, expression or abbreviation, the use of which is prohibited or restricted under an Act or regulation of the Parliament of Canada or the legislature of a province or territory of Canada; (e) contain the word "amalgamated" unless the credit union is an amalgamated credit union resulting from the amalgamation of two or more credit unions; (f) contain the words "association" or "society"; or (g) contain a word or expression that suggests that a credit union is sponsored by or associated or affiliated with a university or a professional association recognized by the laws of Canada or a province or territory of Canada without the consent in writing of the appropriate university or professional association, as the case may be. 2(5) When two or more credit unions amalgamate, the name of the amalgamated credit union is not prohibited if (a) it is the same as one of the amalgamating credit unions; or (b) it is a distinctive combination of the names of the amalgamating credit unions and is not otherwise confusing or prohibited. 2(6) The addition or deletion of punctuation marks does not make a name different, but a name is not the same for the purposes of the Act if (a) words, numerals or initials are added, deleted or substituted; or (b) the final word of the name is varied by substituting one of the legal elements or the corresponding abbreviation required under section 10 of the Act. 2(7) The following punctuation marks and other marks are the only ones permitted as part of the name of a credit union: ! " # $ % & ' ( ) * + , - . / : ; ? [ ]  \ 2(8) The Registrar may record the character "Œ" as "OE" in a record prepared or maintained by the Registrar. 2(9) A credit union name must not be primarily or only a combination of punctuation marks or other marks. 2(10) The name of a credit union must be set out in articles filed with the Registrar in block capital letters. Changing registered office address 3(1) A credit union must not change its registered office address from the address specified in the credit union's articles until it gives the members four months' notice of the change of address. The notice must be given in accordance with section 219 of the Act. 3(2) Within 15 days after changing its registered office address, a credit union must send the Registrar a notice of change of registered office address in the form the Registrar requires. Relocating or closing branch offices 4(1) Subject to subsection (2), a credit union must not relocate or close a deposit-taking branch until it gives members who are customers of the branch four months' notice of the relocation or closing. The notice must be given in accordance with section 219 of the Act. 4(2) Subsection (1) does not apply to the relocation or closing of a deposit-taking branch if (a) the distance to the relocated deposit-taking branch is no more than 500 m; (b) the branch being relocated or closed is consolidated with one or more branches and the distance from it to the consolidated deposit-taking branch is no more than 500 m; (c) the relocation or closing is temporary and is necessary to allow the credit union to deal with unexpected circumstances; or (d) the relocation or closing is a necessary response to a risk to the safety of the personnel of the branch or the public. Concurrent physical meetings 5(1) A credit union may hold a meeting of members by holding two or more concurrent physical meetings in different locations if the locations are linked electronically in a manner that allows all participants to communicate with each other concurrently. 5(2) For the purposes of establishing quorum and counting votes, a meeting held in accordance with subsection (1) is deemed to be a single meeting. Audit committee 6 The audit committee of a credit union must (a) review the annual audited financial statements with the board of directors, the manager and the auditor; (b) review the changes in the accounting standards followed by the credit union; (c) recommend the appointment of an auditor to the board of directors; (d) review the audit fees; (e) review the scope, timing and coordination of the external and internal audit plans; (f) review any difficulties or restrictions experienced by the auditor in carrying out the audit and the findings of the audit; (g) review all significant recommendations made by the auditor to the credit union's management on the subject of internal control and the management response to the recommendations; (h) review all significant differences of opinion between the auditor and the credit union's management, whether or not they are resolved; and (i) perform such other duties and carry out such other functions as may be determined by resolution by the credit union's board of directors. Financial statements and audit reports 7 The financial statements and auditor's report respecting a credit union must be prepared in accordance with generally accepted accounting principles as set out in the CPA Canada Standards and Guidance Collection (CPA Canada Handbook) published by Chartered Professional Accountants of Canada. Security issue requirements 8 In addition to an offering statement, the Registrar may require a credit union to provide the Registrar with any financial statements, feasibility reports or other documents the Registrar considers necessary to exercise the discretion to issue a receipt under subsection 51.3(1) of the Act. Exemption from securities requirements 9 Subsection 51.2(1) of the Act does not apply to (a) the issue of common shares of a credit union to a person if the total consideration paid or payable by the person for all common shares of the credit union owned by or to be issued to them does not exceed $1,000; or (b) the issue of securities that are purchased on behalf of a member by the application of patronage refunds or share dividends to the credit of the member. Payment of prescribed amount on death of a member 10 For the purposes of subsection 41(3) of the Act, the maximum amount a credit union may pay out of moneys standing to the credit of a deceased member is $5,000. Unclaimed balances 11(1) If a member has a balance of $1,000 or less in deposits with a credit union and has not transacted any business with the credit union for a period of two years or more, the directors, after giving notice to the member by mail sent to the last known address of the member, may, if the notice is not acknowledged, transfer the balance to a special trust fund established for the purpose of retaining unclaimed monies in the records of the credit union. 11(2) Interest on the special trust fund may be paid at such rates and for such periods as the directors may determine. 11(3) In the event that a credit union makes an extraordinary sale, lease or exchange under section 125 of the Act, or is liquidated or dissolved, the special trust fund established by the credit union and all records pertaining to it must be transferred to the guarantee corporation. 11(4) All monies held to the credit of a member in a special trust fund must, upon application, be paid to that member. 11(5) A credit union must not charge a fee or other charge in respect of balances held in the special trust fund that it would not normally charge in respect of other deposit accounts. OPERATIONS OF THE CENTRAL Audit committee 12 The audit committee of the central must (a) review the annual audited financial statements with the board of directors, the manager and the auditor; (b) review the changes in the accounting standards followed by the central; (c) recommend the appointment of an auditor to the board of directors; (d) review the audit fees; (e) review the scope, timing and coordination of the external and internal audit plans; (f) review any difficulties or restrictions experienced by the auditor in carrying out the audit and the findings of the audit; (g) review all significant recommendations made by the auditor to the central's management on the subject of internal control and the management response to the recommendations; (h) review all significant differences of opinion between the auditor and the central's management, whether or not they are resolved; and (i) perform such other duties and carry out such other functions as may be determined by resolution by the central's board of directors. Financial statements and audit reports 13 The financial statements and auditor's report respecting the central must be prepared in accordance with generally accepted accounting principles as set out in the CPA Canada Standards and Guidance Collection (CPA Canada Handbook) published by Chartered Professional Accountants of Canada. Credit committee 14(1) In this section, "credit committee" means the system credit committee to be established by the central under section 190 of the Act. 14(2) The terms of reference for the credit committee, including its powers and duties, are the terms of reference approved by the guarantee corporation. 14(3) Instead of approving the credit committee's terms of reference, the guarantee corporation may establish them in a prudential standard. 14(4) The guarantee corporation may require a credit union to submit a loan application to the credit committee for approval before advancing any part of a loan or acquiring all or part of another lender's interest in a loan. 14(5) The credit committee may (a) approve a loan application as submitted; (b) approve a loan application with conditions or variations; or (c) reject a loan application. The credit committee must notify the credit union of its decision as soon as practicable. 14(6) The credit committee must provide the guarantee corporation with any reports or information requested by the guarantee corporation relating to (a) the credit committee's decision with respect to a specific loan; (b) data respecting loan approvals, variances and rejections; and (c) the credit underwriting practices of credit unions or any particular credit union. OPERATIONS OF THE GUARANTEE CORPORATION French services by guarantee corporation 15 The guarantee corporation must provide the following services in French: (a) its website and the information it makes available to the public must be available in French; (b) audited financial statements must be available in French; (c) it must be able to communicate in French with members of caisses populaires and any person expressing an interest in membership in a caisse populaire; (d) it must be able to accept correspondence and written reports in French from caisses populaires and to review files that the caisses populaires maintain in French; (e) it must be able to give written reports in French to the caisses populaires. Maximum quarterly levy and special assessment on credit unions 16(1) For the purpose of subsection 160(1) of the Act, the maximum quarterly levy on a credit union is 1/16 of 1%. 16(2) For the purpose of subsection 160(4) of the Act, the maximum special assessment that may be levied on a credit union is 1/8 of 1%. Oversight fee payable by guarantee corporation 17 For the purpose of subsection 190.5 of the Act, the annual amount the guarantee corporation must pay to the Registrar is $300,000. OTHER FEES Fees 18(1) The following fees are payable under the Act and include the cost of notices that the Registrar must publish in The Manitoba Gazette : (a) on issuance by the Registrar of a certificate of (i) incorporation of a credit union 18(2) Despite subclause (1)⁠(a)⁠(iv), no fee is payable when restated articles are filed concurrently with articles of amendment or in response to a direction of the Registrar. 18(3) The Registrar may waive the payment of a late filing fee under clause (1)⁠(e), in whole or in part, if the Registrar considers that the circumstances resulting in the late filing were beyond the control of the credit union. REPEAL AND COMING INTO FORCE Repeal 19 The Credit Unions and Caisses Populaires Regulation , Manitoba Regulation 361/87, is repealed. Coming into force 20 This regulation comes into force on the same day that The Credit Unions and Caisses Populaires Amendment Act , S.M. 2021, c. 24, comes into force.