Banking industry supports improved disclosure regs for PPNs

Clear Disclosure Always a Priority for Banks

For Immediate Release
June 2, 2008

The Canadian Bankers Association (CBA) welcomed the release of the improved disclosure regulations for Principal Protected Notes (PPNs) announced by Federal Finance Minister Jim Flaherty today.

Since the development of these products a number of years ago, the banks have voluntarily provided clear disclosure to customers on the fees, returns and risks of PPNs, and continue to enhance this disclosure.

“We’re supportive of these new regulations which will enhance the disclosure of information regarding PPNs so that investors can make informed investment decisions,” said Nancy Hughes Anthony, President and CEO of the Canadian Bankers Association. “The Department of Finance consulted with the banking industry and others when developing the regulations and we support the approach the government is taking.”

PPNs issued by banks are considered deposits and, therefore, subject to disclosure requirements under the Bank Act. The new regulations will come into force on July 1, 2008.

“The regulations that the government is proposing are principles-based and we are supportive of a more flexible regulatory regime that enhances disclosure without being overly prescriptive,” said Ms. Hughes Anthony.

The Canadian Bankers Association works on behalf of 51 domestic chartered banks, foreign bank subsidiaries and foreign bank branches operating in Canada and their 249,000 employees to advocate for efficient and effective public policies governing banks and to promote an understanding of the banking industry and its importance to Canadians and the Canadian economy.

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For more information:
Melanie Minos, Canadian Bankers Association
Tel: (416) 362-6093, ext. 220
Cell: (416) 587-7733,
E-mail: mminos@cba.ca