Definition
The Bank Act (S.C. 1991, c. 46) is the primary federal law regulating banking institutions in Canada.
**Scope**: - Applies to federally chartered banks (Schedule I, II, III) - Schedule I: widely-held Canadian banks (RBC, TD, BMO, NBC, Scotiabank, CIBC) - Schedule II: Canadian subsidiaries of foreign banks (HSBC, Citibank Canada, etc.) - Schedule III: branches of foreign banks
**Mortgage relevance**: - Defines the types of loans banks may grant (including residential mortgages) - Establishes rules for disclosure of borrowing costs to consumers - Empowers OSFI to set capital and liquidity requirements - Governs rules for resolving bank complaints
**OSFI (Office of the Superintendent of Financial Institutions)**: OSFI is the federal prudential regulator of banks. Guideline B-20 (Residential Mortgage Underwriting Practices and Procedures) is the main tool for regulating mortgage origination criteria.
**Relationship with provincial regulation**: Banks are federally regulated — mortgage brokers are provincially regulated (OACIQ in Quebec, BCFSA in BC, RECA in Alberta). A mortgage broker submits applications to banks but is not governed by the Bank Act.