TORONTO - Ford's Canadian lending arm is applying to become a bank so it can access a new source of funding.

Ford Credit Canada, a subsidiary of Ford Motor Co. (NYSE:F), would be able to accept consumer deposits that would be guaranteed by the Canada Deposit Insurance Corp. if the company is granted bank status, said Ford Credit spokeswoman Margaret Mellott.

"It's really very simple: our goal is to support Ford dealers and customers, and part of the way we do that is through a wide variety of funding channels and sources and this is a strategy to diversify our funding," Mellott said.

As a bank, Ford Credit Canada would offer guaranteed investment certificates, or GICs, as well as a "very, very limited online-only savings operation," Mellott said.

But the company wouldn't alter its core service, which is to provide financing for Ford dealers and customers.

If the application by Ford Credit Canada is approved, the Oakville, Ont.,-headquartered company will change its name to Ford Credit Bank.

The approval process is expected to be a lengthy one.

"There's no timetable, but there's a lot of due diligence. There's a lot of study involved because, of course, the government will make a very measured decision," Mellott said.

The major automakers' finance arms suffered during the 2008-09 financial crisis as credit tightened, making it difficult or nearly impossible to raise money to fund their lending activities.

Frozen credit markets were a major factor in slumping vehicle sales in both Canada and the U.S., which served to exacerbate the recession and forced major automakers Chrysler and General Motors into bankruptcy protection.

Most automakers' financing arms were forced to increase the credit score necessary to get a lease or loan to protect themselves from defaults after the financial meltdown. That created a vicious cycle, making it harder for consumers to lease or buy new vehicles, while it simultaneously became more difficult for dealers to get the financing necessary to keep their showrooms stocked.

Chrysler Financial was forced to wind down due to a lack of capital after Chrysler LLC filed for bankruptcy protection in the United States in April. General Motors' credit company, GMAC Financial Services, took over its business.

During the recession, GMAC applied for and received bank holding status in the United States, a category that made it eligible for government support, including guarantees of its debt and access to emergency loans. GMAC's banking arm has since been rebranded as Ally and offers GICs and savings accounts in Canada.

Ford was the only one of the Detroit Three automakers that wasn't forced to restructure under U.S. bankruptcy protection during the economic crisis. Ford Credit hasn't applied for bank status in the United States.