Mr. Thomas Vien (Lotlbiniere) presented the tenth report of the select standing committee on Banking and Commerce as follows:
Pursuant to the Order of Reference from this House of the 31st of March, 1924, your committee, in view of the failure of the Home Bank, have considered the provisions of the Bank Act with a view to recommending such amendments to the act as would better protect the interests of bank depositors generally, and would prevent similar occurrences in the future:
And your committee are of the opinion that it is expedient to bring in a measure to amend the Bank Act and they therefore recommend that the said act be amended as follows:
That Section 56A of the Bank Act be repealed, and the following substituted therefor:
"56A. 1. The Governor in Council on the recommendation of the minister shall appoint a person who in his opinion has had proper training and experience who shall be charged with the performance of the duties hereinafter mentioned. Such person shall be designated "Inpector General of Banks". The minister may direct some other such person to temporarily perform the duties of the inspector should the inspector, by reason of illness or other contingency, be unable to perform such duties.
"2. The Inspector shall hold office during good behaviour, but may be removed from office by the Governor in Council for misbehaviour or incapacity, inability, or failure to perform his duties properly.
"3. If the Inspector is removed from office for any such reason the order in council providing for such
Banking and Commerce-Report
removal and documents relating thereto shall be laid before parliament within the first fifteen days of the next ensuing session.
"4. The Inspector while holding office shall not perform any service for compensation other than the service rendered by him under the provisions of this section.
"5. The minister may appoint or employ on the recommendation of the Deputy Minister of Finance and the inspector, such persons with training and experience and such clerical assistants as may be deemed necessary to carry out and give effect to the provisions of this section. Persons so appointed or employed shall receive such salary or remuneration as may be fixed by the minister".
" 6. The inspector, from time to time, but not less frequently than once in each calendar year shall make or cause to be made, such examination and inquiry into the affairs or business of each bank as he may deem to be necessary or expedient, and for such purposes to take charge of the assets of the bank or any portion thereof, if the need should arise for the purpose of satisfying himself that the provisions of this act have reference to the safety of the creditors and shareholders of each such bank are being duly observed and that the bank is in a sound financial condition. The inspector at the conclusion of each such examination and inquiry shall report thereon to the minister.
" 7. A copy of all reports made by the auditors of a bank to the general manager and to the directors under the next preceding section shall be transmitted or delivered to the minister by the auditors at the same time as such reports are transmitted or delivered to the general manager and directors.
" 8. The inspector, or person acting under his direction, shall have a right of access to the books and accounts, documents, vouchers and securities of the bank, and shall be entitled to require and receive from the directors, officers and auditors of the bank such information and explanation as he may deem necessary for the performance of his duties.
9. The inspector shall have all the powers conferred upon a commissioner appointed under the Inquiries Act for the purpose of obtaining evidence under oath, and may delegate such powers as occasion may require. Any person who refuses to give such evidence or to produce any book or document material thereto when required so to do shall be guilty of an offence against this act.
"10. Whenever the inspector is satisfied that a bank is insolvent he shall report fully on the bank's condition to the minister and the minister may, without waiting for the bank to suspend payment in specie or Dominion notes of any of its liabilities as they accrue, request the association or the president of the association to appoint a curator to supervise the affairs of such bank, and such request shall have the same effect as if the bank had suspended payment in specie or Dominion notes of any of its liabilities as they accrued, and a curator shall forthwith be appointed as provided in section 117 of this act.
"11. The inspector shall be paid a salary fixed by the Governor in Council on the recommendation of the minister.
" 12. All salaries, remunerations and other expenses incidental to giving effect to this section shall be paid out of the Consolidated Revenue Fund, and the Consolidated Revenue Fund shall be recouped after the end of each calendar year for such outlay by an assessment upon the banks based upon the average total assets of the banks respectively during the year, as shown by the monthly returns made by the banks to the minister under section 112, and such assessment shall be paid by the banks.
"13. All persons appointed under this section shall be officers of the Department of Finance, but the
provisions of the Civil Service Act, 1918, shall not apply to such persons.
" 14. Any bank or any director, president, general manager or any officer of a bank who directly or indirectly makes a loan or grant or gives any gratuity to the inspector or any other person appointed or employed under this section and the inspector or any such person who accepts or receives directly or indirectly, any such loan, grant or gratuity, commits an offence against this act, and is liable as provided in section 157 of this Act, in addition to any punishment otherwise provided.
" 15. The inspector or any person appointed or employed under this section who disclose to any other person, except the Minister and the Deputy Minister of Finance, any information regarding a bank, its business or affairs commits an offence against this act and is liable as provided in section 157 of the act.
" 16. Provided, however, that the government shall not incur any liability whatever to any depositor, creditor or shareholder of any bank, or to any other person, for any damages, payment, compensation or indemnity which he may suffer or claim by reason of this section or anything therein contained, or by reason of anything done or omitted to be done under the requirements thereof, or by reason of anything omitted to be done which is hereby required to be done, or by reason of any order or direction of the Governor in Council or of the minister in the execution or administration of the powers or any or them by this section conferred, or by reason of any failure or omission on the part of governor in council or of the minister or of the inspector or of any officer or employee of the government to execute or discharge any power, authority or duty thereunder, or otherwise by reason of any default, negligence, mistake, error or omission in the administration or discharge of the powers or duties which in any circumstances are by this section intended or authorized to be executed or performed; and no such payment, damages, compensation or indemnity, nor any claim therefor, shall in any case be authorized, paid or entertained by the government.
" 17. This section shall come into force on the first day of October, nineteen hundred and twenty-four, but it shall not be incumbent upon the inspector to examine all of the banks under the section during the calendar year one thousand nine hundred and twenty-four."
He said: I beg to move that -the tenth
report of the select standing committee on Banking and Commerce be concurred in.