Bank Act

Marginal note:Prepayment protected

• 575 (1) An authorized foreign bank shall not make a loan to a natural person that is repayable in Canada, the terms of which prohibit prepayment of the money advanced or any instalment on the money advanced before its due date.

• Marginal note:Minimum balance

  (2) Except by express agreement between the authorized foreign bank and the borrower, the making in Canada of a loan or advance by an authorized foreign bank to a borrower shall not be subject to a condition that the borrower maintain a minimum credit balance with the authorized foreign bank.

• Marginal note:Non-application of subsection (1)

  (3) Subsection (1) does not apply in respect of a loan

  • (a) that is secured by a mortgage on real property; or

  • (b) that is made for business purposes and the principal amount of which is more than $100,000 or any other amount that may be prescribed.

• Marginal note:Government cheques

  (4) An authorized foreign bank shall not make a charge

  • (a) for cashing a cheque or other instrument drawn on the Receiver General or on the Receiver General’s account in the Bank of Canada, or in any bank or other deposit-taking Canadian financial institution incorporated by or under an Act of Parliament or in any authorized foreign bank that is not subject to the restrictions and requirements referred to in subsection 524(2), in respect of its business in Canada;

  • (b) for cashing any other instrument issued as authority for the payment of money out of the Consolidated Revenue Fund; or

  • (c) in respect of any cheque or other instrument that is

    • (i) drawn in favour of the Receiver General, the Government of Canada or any department of the Government of Canada or any public officer acting in the capacity of a public officer, and

    • (ii) tendered for deposit to the credit of the Receiver General.

• Marginal note:Deposits of Government of Canada

  (5) Nothing in subsection (4) precludes any arrangement between the Government of Canada and an authorized foreign bank concerning

  • (a) compensation for services performed by the authorized foreign bank for the Government of Canada; or

  • (b) interest to be paid on any or all deposits of the Government of Canada with the authorized foreign bank.