Application Process

Phase 1 - Initial Readiness Assessment

This phase supports early engagement between OSFI and applicants and enables an initial, focused assessment of readiness, including ownership, financial strength, and overall viability.

Information requirements at this stage are proportionate and streamlined, and do not replace the more comprehensive assessment undertaken during the Formal Application Review Phase (Phase 2). Regulatory requirements remain the same for all new entrants. Any elements not assessed in Phase 1 are reviewed in Phase 2.

• Applicant contacts OSFI at StreamlinedApprovals-Approbationssimplifiees@osfi-bsif.gc.ca
• OSFI issues a letter outlining the approvals process, required pre-application information, and next steps.
• Applicant submits Pre-Application Information Requirements for Provincial Credit Unions or Innovators to OSFI for review and consideration.
• OSFI meets with the applicant to discuss pre-application materials.
• OSFI reviews the material and may engage with the applicant to request clarifications or additional information.
• Within 4 weeks of the meeting, OSFI issues an Initial Readiness Assessment letter to the applicant, setting out its preliminary views on suitability for the streamlined framework and expectations regarding the proposed application.
• If OSFI determines the applicant is suitable for the streamlined framework, the applicant proceeds to submit a formal application as the next step in the process.
• Requirements specific to Provincial Credit Union (PCU)-FCU continuance:
  • Applicant sends notice to members of upcoming vote on a special resolution authorizing an application for Letters Patent, as well as complying with any other relevant provisions of the Disclosure on Continuance Regulations (Federal Credit Unions).
  • The Disclosure Notice must be approved by the Superintendent of OSFI in consultation with the Canada Deposit Insurance Corporation. As such, a draft copy of the Disclosure Notice must be provided to OSFI for approval prior to the prospective applicant sending it to members.
  • Members vote on special resolution authorizing application for Letters Patent.
  • Applicant proceeds to submit formal application to OSFI as the next step in the process.

Phase 2 - Formal Application (Letters Patent)

Phase 2 requires the submission of comprehensive information to enable assessment against core regulatory requirements. In addition to all information outlined in Phase 1, applicants must submit additional detailed information to support evaluations against core regulatory requirements, including those related to operational resilience, financial resilience, risk governance and integrity and security risks.

In addition, given the heightened execution risk and more limited recovery options faced by new entrants, Phase 2 also includes an assessment of the applicant's exit planning for an orderly wind-down of its federally licensed operations, if required. This assessment is not intended to prevent failure, but to mitigate broader systemic risks and limit contagion within the financial system.

• Prior to submitting a formal application, the applicant gives notice of its intention to apply for Letters Patent.
  • The applicant is required to publish this notice once a week for four consecutive weeks in the Canada Gazette and in a newspaper in general circulation at or near the place where the head office of the FRFI is to be situated.
• Applicant submits formal application for Letters Patent to OSFI for review and consideration. The applicant pays the application fees according to the Service standards and fees following the acknowledgement of filing.
  • The applicant is required to submit the information requirements outlined in the formal application requirement checklist for Innovators (PDF) or for PCUs (PDF) . These include the information requirements from the Guide for Incorporating Banks and Federally Regulated Trust and Loan Companies and Guide for Continuing a Local Cooperative Credit Society as a Federal Credit Union as well as additional requirements to reflect updates in OSFI guidance and the expansion of OSFI's mandate to include integrity and security.
  • The applicant may also choose to participate in a voluntary OSFI managed public dashboard tracking the progress of their application. Consent to participate will also be sought at this time.
• OSFI reviews the submission against the formal list of requirements and will issue an acknowledgment of filing to confirm the date the application was submitted. This date marks the beginning of OSFI's formal review process. If the applicant is participating in OSFI's public dashboard, the entity's formal application submission is recorded.
• OSFI could request further information or details and meet with the applicant during the course of its review of the application.
• As appropriate, OSFI recommends restrictions or conditions (for example, undertakings, prudential agreement, business restrictions).
• OSFI submits a recommendation to the Minister for approval of Letters Patent within 12 months of the submission date communicated in the acknowledgement of filing.

Phase 3 - Operational Readiness (Post-Ministerial Approval)

In this phase, the review will focus on whether key people, policies, processes and systems are in place and meet expectations. The streamlined framework may allow applicants to fully develop policies, processes or systems after receiving their OCCB, subject to potential restrictions or conditions.

• Following the issuance of LPs by the Minister of Finance, OSFI continues its assessment of the application, including the review of credible exit plans for the orderly wind-down of operations, if required. OSFI may make additional requests for information or details.
• Applicant submits formal application requesting the issuance of OCCB and demonstrating that they meet all the information requirements.
• OSFI carries out a pre-commencement review of the FRFI.
• Once material issues or concerns are adequately addressed, the Superintendent issues the OCCB.
  • As appropriate, OSFI may impose temporary restrictions or conditions (for example, limits on activities, growth, or product scope) while the FRFI addresses remaining gaps (for example, some policies, processes or systems may require further development post Order to Commence and Carry on Business - approval).
• Superintendent issues Order to Commence and Carry on Business within three months of ministerial approval (or aligned to applicant's operational commencement plans).

Applicants are encouraged to familiarize themselves with all the framework requirements, ensure submissions are complete at each phase of the process, and provide required security forms as early as possible to avoid delays. Applicants may also wish to consider external legal or advisory support, where appropriate.