Questrade Financial Group Inc. moved a step closer to obtaining a banking licence in Canada, entering the final phase of a rigorous process to earn approval from the federal banking regulator.
The Office of the Superintendent of Financial Institutions, or OSFI, published a notice on Friday that said the government had issued letters patent – a form of legal documentation – incorporating an entity known as Questbank, effective March 6.
Questrade, which is best known for its online trading platform and has about $50-billion of assets under administration, applied to obtain a Schedule 1 banking licence in late 2019. The process, which is typically a lengthy one, was further delayed by the COVID-19 pandemic.
“We can confirm that the Minister of Finance signed our letters patent on March 6, marking an important milestone for our organization in the process towards forming a bank,” said Tanya Woods, Questrade’s managing director of government and regulatory affairs and policy counsel, in an e-mailed statement.
“We look forward to completing the final phase of this process and doing even more to help Canadians become much more financially successful and secure.”
A Schedule 1 bank is a domestically owned bank that can accept deposits, such as Canada’s Big Six banks or online challengers such as Equitable Bank. An applicant needs OSFI approval, and the final responsibility for incorporating a federally regulated financial institution rests with the Minister of Finance.
Mobile banking provider Koho Financial Inc. also has a pending application for a banking licence. In January of 2024, Koho chief executive Daniel Eberhard said his company had moved into the second phase of a three-stage process, and that he hoped the company could be operating its new KOHO Bank unit within 18 to 24 months.
