OSFI holds cash cushion that large lenders must set aside for protection steady at 3.5 per cent
Canada ’s banking regulator is holding the cash cushion that large lenders must set aside for protection steady at 3.5 per cent, noting that vulnerabilities in the financial system remain elevated.
All banks are required to meet minimum capital levels to ensure they have reserves to absorb loan losses, but the Office of the Superintendent of Financial Institutions mandates that banks considered to be systemically important – that is, all of the Big Six banks – should often hold capital over and above this level.On Tuesday, OSFI said a hike wasn’t necessary this time around because the large banks hold capital reserves above the 3.
The “3.5 per cent plus discipline at the Big Six banks is sufficient resilience for a potential downturn,” OSFI superintendent Peter Routledge said on a conference call Tuesday. Because the banks are well-capitalized, there was a chance OSFI could even lower the buffer this time around, in response to economic conditions. OSFI typically requires banks to hold more capital when business is good and credit losses are low, helping them build a surplus that can be released when the economy is under strain. When capital is released, it can be used to fund loans.
Bank Capital Osfi Buffer Canada Banks Level Bank Of Canada Royal Bank Of Canada Canada
Philippines Latest News, Philippines Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Federal banking regulator OSFI keeps domestic stability buffer on hold at 3.5%OTTAWA — The federal banking regulator is keeping its domestic stability buffer on hold as it says financial system vulnerabilities remain elevated but stable, while near-term risks continue to be low despite some recent increase.
Read more »
Federal banking regulator OSFI keeps domestic stability buffer on hold at 3.5%OTTAWA — The federal banking regulator is keeping its domestic stability buffer on hold as it says financial system vulnerabilities remain elevated but stable, while near-term risks continue to be low despite some recent increase.
Read more »
Mortgage lending among top risks facing financial system: OSFIOTTAWA — Canada's banking regulator says real estate secured lending and mortgages are among the top risks facing the country's financial system as higher...
Read more »
Mortgage lending among top risks facing financial system: OSFIOTTAWA — Canada's banking regulator says real estate secured lending and mortgages are among the top risks facing the country's financial system as higher interest rates put pressure on borrowers.
Read more »
Mortgage lending among top risks facing financial system: OSFIOTTAWA — Canada's banking regulator says real estate secured lending and mortgages are among the top risks facing the country's financial system as higher interest rates put pressure on borrowers.
Read more »
Mortgage lending among top risks facing financial system: OSFIOTTAWA — Canada's banking regulator says real estate secured lending and mortgages are among the top risks facing the country's financial system as higher interest rates put pressure on borrowers.
Read more »