Ontario Modernizes Credit Union Regulation
McGuinty Government Updates Financial Regulation and Enhances Consumer Protection
Ontario has proclaimed amendments to the Credit Union and Caisses Populaires Act, 1994 that will enable credit unions and caisses populaires to remain competitive in the financial services marketplace while preserving the soundness of the regulatory system.
By updating and streamlining the statutes and regulations governing Ontario credit unions, the government is:
- Modernizing capital rules while maintaining appropriate capital standards
- Updating investment and lending rules consistent with prudent risk management standards
- Simplifying requirements for smaller, less complex credit unions
- Modernizing corporate governance
- Streamlining regulatory oversight while providing regulators with additional tools to promote compliance
- Making it easier for consumers to understand the cost of borrowing.
Amendments to the Act and new regulations will take effect on October 1, 2009. A limited number of provisions requiring a transition period, including new cost of borrowing and disclosure borrower requirements, are set to come into effect on October 1, 2010.
After the changes to the Act and regulations are completed in 2010, Ontario will have implemented a new standard for providing modern and streamlined regulations for credit unions that will give the sector increased flexibility and encourage competitiveness.
- The Credit Unions and Caisses Populaires Act, 1994 sets out the legislative framework in which credit unions and caisses populaires operate in Ontario.
- Ontario's 196 credit unions and caisses populaires have approximately $28 billion in assets and over 1.6 million members. They operate in more than 600 locations across the province.
“Updating the Credit Unions and Caisses Populaires Act is a clear demonstration of our government's commitment to ensure that financial services regulation in Ontario remains strong and progressive. These reforms create a balanced regulatory environment that promotes consumer protection and sound corporate governance, but also allows Ontario's credit unions to remain competitive and serve their members in communities across Ontario.”