The Reporter provides a monthly summary of Canadian federal legislative and regulatory developments of relevance to federally regulated financial institutions. It does not address Canadian provincial financial services legislative and regulatory developments, although this information is tracked by BLG and can be provided on request. In addition, purely technical and administrative changes (such as changes to reporting forms) are not covered.
March 2016
Institution | Published | Title and Brief Summary | Status |
OSFI [Applicable to insurance companies] |
Issued March 31, 2016 | Draft guideline – Life insurance Capital
Adequacy Test-Public Consultation The Life Insurance Capital Adequacy Test (LICAT) guideline will replace the current life insurance capital test, the Minimum Continuing Capital and Surplus Requirements (MCCSR) guideline, in place since 1992. The key changes introduced by the LICAT guideline compared to the MCCSR include:
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Comments should be provided no later than May 9, 2016 |
BIS/Basel [Applicable to banks] |
Published March 24, 2016 | Reducing variation in credit risk-weighted assets
— constraints on the use of internal model approaches —
Consultative document The proposed changes to the IRB approaches set out in this consultative document include a number of complementary measures that aim to: (i) reduce the complexity of the regulatory framework and improve comparability; and (ii) address excessive variability in the capital requirements for credit risk. Specifically, the Basel Committee proposes to:
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Comments should be provided no later than June 24, 2016 |
Finance | Published (Gazette) — March 23, 2016 | By-law Amending the Canada Deposit Insurance
Corporation Deposit Insurance Information By-law The Amending By-law introduces the requirements that the Federal Credit Unions (FCU):
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In force |
BIS/Basel [Applicable to banks] |
Issued March 17, 2016 | Handbook for Regulatory Consistency Assessment
Programme (RCAP) jurisdictional assessments The Handbook for RCAP describes the guidance, principles and processes for assessing compliance with Basel standards under the Regulatory Consistency Assessment Programme. The programme is sufficiently general to accommodate differences in structural and institutional factors across jurisdictions. The RCAP Handbook presents a general framework as well as specific processes and procedures for assessing a jurisdiction's regulatory framework for (i) risk-based capital standards, (ii) the Liquidity Coverage Ratio (LCR) and (iii) global systemically important banks (G-SIBs). |
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BIS/Basel [Applicable to banks] |
Issued March 11, 2016 | Pillar
3 disclosure requirements — consolidated and enhanced
framework — Consultative document Pillar 3 of the Basel framework seeks to promote market discipline through regulatory disclosure requirements. The proposed enhancements issued include:
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Comments should be provided no later than June 10, 2016 |
OSFI [Applicable to banks, trust and loan companies, cooperative credit associations and insurance companies] |
Issued March 10, 2016 | IFRS 9 Financial Instruments and Disclosures
— Draft Guideline The proposals contained in the draft guideline have been tailored to the size, nature and complexity of FREs. For example, more detailed requirements for the application of the IFRS 9 expected credit loss framework are proposed for banks that are systemically important in Canada based on the recent guidance issued by the BCBS. By contrast the proposals for other deposit-taking institutions are more tailored for the size, nature and complexity of those institutions. In addition to new guidance on expected credit losses, OSFI proposes, the following seven Guidelines be revised or replaced and consolidated into a single IFRS 9 Financial Instruments and Disclosures Guideline:
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Comments should be provided no later than May 6, 2016 |
BIS/Basel [Applicable to banks] |
Issued March 4, 2016 | Standardised Measurement Approach for operational
risk-Consultative Document The proposed revisions to the operational risk capital framework are part of the Committee's broad objective of balancing simplicity, comparability and risk sensitivity. The SMA addresses a number of weaknesses in the current framework. In particular:
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Comments should be provided no later than June 3, 2016 |
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.