A proposed legal framework to allow credit unions to be incorporated, and regulated, at the federal level is set to go.
New regulations published Thursday will enable credit unions that choose federal incorporation to operate more seamlessly across provincial borders, and to be subject to oversight by the Office of the Superintendent of Financial Institutions (OSFI), the Department of Finance said. The decision to allow federally incorporated and regulated credit unions was announced in the 2010 federal budget, and enabling legislation was introduced, finalizing the proposed regulations will bring this framework into force.
The move was welcomed by Credit Union Central of Canada (CUCC), which said that the changes “will support the evolution of the Canadian credit union system by providing interested credit unions with an option to operate across Canada and beyond their current provincial boundaries.”
The CUCC said that it has been working with the federal government over the past two years to ensure the necessary steps would be taken to proclaim the federal credit union legislation into force.
“Credit Union Central of Canada supports the availability of a federal option for credit unions. We welcome today’s announcement as another step toward enabling credit unions to choose a new option to address growth opportunities and enhance service to their members,” said Gary Rogers, vice president, financial policy at the CUCC.
“Allowing credit unions to operate nationally will give consumers greater financial choice and spread the benefits of federal regulation to more Canadians. As a result of these changes, credit unions will be able to improve the services they offer,” said federal finance minister, Jim Flaherty.
The regulations are being published for a 30-day comment period.