Credit unions in British Columbia are incorporated under provincial legislation. They are authorized to carry on deposit business or both deposit and trust business under the Financial Institutions Act of British Columbia. The Act confers powers on credit unions such as the ability to lend, borrow and invest. It also specifies the amount and types of reserves they must maintain.
Provisions relating to credit union membership and shares are set out in the Credit Union Incorporation Act of British Columbia.
The Financial Institutions Act requires that each credit union have an audit committee and be audited by independent auditors. Credit unions are also subject to inspection by the Superintendent of Financial Institutions, an official of the Financial Institutions Commission, or his appointee. The Financial Institutions Commission regulates B.C.'s financial institutions, including credit unions. The Commission is responsible to the provincial Minister of Finance.
Stabilization Central Credit Union of British Columbia was incorporated in 1989 to implement self-regulation within the provincial credit union system. Its primary purpose is to monitor credit unions and take early action to correct any identified problems. Accordingly, Stabilization Central supervises credit unions assigned to it by the Financial Institutions Commission or credit unions that voluntarily come under its supervision.
Every local credit union in B.C. must maintain membership in Stabilization Central as a condition of holding a business authorization. Stabilization Central is funded by its member credit unions and is directed by a board elected by, or appointed from, these members.