OTTAWA — Canada’s banking regulator says it has delayed by a year a rule change established by international banking standards.
The Office of the Superintendent of Financial Institutions says the delay in implementing an increase in the minimum capital requirements will give it time to consider how fast other countries are making the changes.
There have been concerns in Canada’s banking sector that OSFI was moving faster than U.S. regulators and others in putting in place the new rules, which would put domestic banks at a disadvantage.
The rules set out by the Basel Committee on Banking Supervision are meant to set and standardize international capital floors to provide for more stability and comparability in the banking sector.
The rules set that a bank’s internal modelling of assets, when weighted for risk, can’t fall below a given threshold.
OSFI head Peter Routledge says consistent adoption across jurisdiction is key to the success of the reforms so that competitive balance prevails.
This report by The Canadian Press was first published July 5, 2024.
