BNY Trust to Reduce Stated Capital

Summary#

BNY Trust Company of Canada says it will apply to the Superintendent of Financial Institutions (Canada) for permission to reduce the stated capital of its common shares under the Trust and Loan Companies Act (Canada). The company’s sole shareholder approved a plan on September 12, 2024 to cut stated capital by up to $26.5 million, with any approved amount to be paid to that shareholder.

What it does#

• Gives public notice that BNY Trust Company of Canada intends to ask the Superintendent of Financial Institutions (Canada) to approve a cut to the company’s stated capital for its common shares.
• The reduction is limited to an Authorized Limit of $26.5 million and any amount approved would be distributed to the company’s sole shareholder.
• The company’s board empowered its officers to make the application and to complete any required paperwork. The company’s chief financial officer will decide the exact amount to be reduced within the $26.5 million limit.
• The notice makes clear that publication does not mean approval will be granted.

Who's affected#

• The most directly affected party is the company’s sole shareholder, who would receive the money if the reduction is approved.
• BNY Trust Company of Canada itself is affected because the change alters its stated capital accounts.
• The Superintendent of Financial Institutions (Canada) will review and decide the application.
• The notice does not name the sole shareholder or say whether customers, creditors, or the broader public will be affected.

Why it matters#

• Reducing stated capital can change a financial institution’s capital structure and how much equity is recorded on its books. That can be important to regulators and anyone tracking the company’s financial strength.
• The action would transfer up to $26.5 million from the company to its sole shareholder if the regulator approves it.
• Because regulatory approval is still required, this notice signals intent rather than a completed transaction.