(August 31 – 15:25 ET) – The Canadian Bankers Association has confirmed its support for Ottawa’s Financial reform legislation — Bill C-38. The CBA has submitted its response to the legislation before the House of Commons standing committee on Finance.
“The banking industry supports the passage and implementation of Bill C- 38 as soon as possible,” says Ray Protti, CEO and President of the CBA. “Measures in the legislation aimed at reshaping the financial sector in Canada have the potential to benefit Canadian consumers and create opportunities for Canadian financial services providers to succeed in a fast-changing marketplace.”
The CBA contends that the federal government’s proposed merger review process for large banks reflects confirmation that “mergers can be a legitimate business strategy for Canada’s banks” in order to respond to the forces of change in the industry and to compete globally.
However, the submission also points out areas where Bill C-38 could have gone further. The CBA is disappointed that the legislation will continue to restrict banks from involvement in insurance and auto lease financing. “Consumers would have greater choice in insurance products and auto financing if banks could compete in these areas,” Protti said.
In its submission, the CBA indicates it wants to work further with the government after the passage of Bill C-38 to remove these restrictions and to:
> have consumer protection measures apply to all financial institutions, not just target banks;
> ensure that the processes for merger reviews and the new permitted investment powers are as streamlined as possible;
> revisit the prohibition on mergers between large banks and large demutualized life insurance companies.
-IE Staff