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.
The July 2019 edition follows below.
August
|
Institution |
Published |
Title and Brief Summary |
Status |
|
OSFI |
OSFI’s Activities with respect to IFRS 17 If the IASB approves the amendments to IFRS 17 and the Canadian Accounting Standards Board incorporates them into the CPA Canada Handbook, OSFI will revise its publicly posted advisories and update the timeline for the key milestones communicated in its June 27, 2018 Capital letter accordingly. In the fall of 2019, OSFI will hold consultative discussions on IFRS 17 Accounting Policy choices with FRIs to understand positions taken and determine if there is consistency and /or comparability of IFRS 17 application across the Canadian industry. If the IASB approves the new IFRS 17 effective date, OSFI expects to add another directed consultation with regard to adapting the insurance capital guidance for IFRS 17 in June 2020. The directed consultation will cover near-final LICAT and MCT 2022 guidelines, forms, and QIS 2. OSFI intends to finalize the LICAT and MCT 2022 guidelines in 2021. In June 2019, the insurance industry was provided with draft regulatory returns updated for IFRS 17. OSFI's goal is to launch a public consultation on the draft regulatory returns in November 2019. OSFI intends to finalize the regulatory returns by June 2020. OSFI will continue to monitor IFRS 17 progress through semi-annual progress reports submitted by FRIs. |
Effective |
July 2019
Comments should be submitted by September 27, 2019
|
Institution |
Published |
Title and Brief Summary |
Status |
|
Bank for International Settlements |
Margin requirements for non-centrally cleared derivatives Relative to the 2015 framework, the revisions extend by one year the final implementation of the margin requirements. With this extension, the final implementation phase will take place on 1 September 2021. To facilitate this extension, the Basel Committee and IOSCO have also introduced an additional implementation phase that begins on 1 September 2020. |
Effective September 1, 2020 |
|
|
Financial Stability Board |
July 19, 2019 |
Regulatory framework for haircuts on non-centrally cleared securities financing transactions The framework aims to address financial stability risks associated with SFTs, setting out numerical haircut floors to apply to non-bank-to-non-bank SFTs. The report was originally published on 12 November 2015; the timelines for recommendations 14 to 18 in Annex 1 have now been adjusted, and the Annex re-published. |
Recommendation 14 effective January 2022 Recommendation 15 effective January 2024 Recommendation 16 effective January 2021 Recommendation 17 effective January 2023 Recommendation 18 effective January 2022 |
|
OSFI |
Use of the Advanced Measurement Approach for Operational Risk Capital Consistent with OSFI's Guideline E-21, Operational Risk Management, OSFI expects larger, more complex banks to continue using internal and external loss data and scenario analysis in their operational risk management frameworks. Banks currently using the AMA approach will no longer be required to use Business Environment and Internal Control Factors in their operational risk management frameworks after Q4 2019. |
Effective |
|
|
OSFI
|
Draft Guideline:
Guideline B-6 – Liquidity Principles The changes proposed aim to ensure that the guideline remains current and relevant as well as appropriate for the scale and complexity of institutions. In addition, the updated guidance clarifies OSFI's expectations regarding institutions' liquidity risk management practices. |
Comments should be received by September 13, 2019 |
|
|
OSFI |
Advancing Proportionality: Tailoring Capital and Liquidity Requirements for Small and Medium-Sized Deposit-Taking Institutions The paper seeks input on possible changes to capital and liquidity requirements for small and medium-sized deposit-taking institutions, and outlines OSFI's initiative to develop more tailored requirements that take into account their unique nature. As new capital and liquidity standards are developed internationally and implemented domestically, OSFI is focused on ensuring that its capital and liquidity regime remains appropriate for these smaller, less complex organizations. This paper focuses on the first phase of this initiative – the Pillar 1 minimum requirements. Subsequent phases will focus on the Pillar 2 (prudential and risk management expectations) and Pillar 3 (public disclosure) requirements. |
||
|
Finance Canada |
Regulations Amending Certain Regulations Made Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act, 2019, SOR/2019-240 The amendments to the regulations strengthen Canada’s AML/ATF Regime by updating customer due diligence requirements; regulating businesses dealing in virtual currency; updating the schedules to the regulations; including foreign money service businesses (MSB) in Canada’s AML/ATF Regime; updating beneficial ownership reporting requirements in suspicious transaction reports; clarifying a number of existing requirements; and making minor technical amendments. |
Effective June 1, 2021, with the exception of s. 39 (effective June 25, 2019) and ss. 3, 6(1) to (3) 50 to 98, 100 to 105, 111 and 112 (effective June 1, 2020) |
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|
Finance Canada |
Payment Clearing and Settlement Regulations, SOR/2019-257 The Regulations come into force concurrently with the proclamation in force of the amendments to the PCSA by the Act. |
Effective June 23, 2019 |
|
|
Financial Action Task Force |
Terrorist Financing Risk Assessment Guidance This guidance aims to assist practitioners, and particularly those in lower capacity countries, in assessing terrorist financing risk at the jurisdiction level by providing good approaches, relevant information sources and practical examples based on country experience. |
Effective |
|
|
Financial Stability Board |
Review of the Technical Implementation of the Total Loss-Absorbing Capacity (TLAC) Standard The Total Loss-Absorbing Capacity (TLAC), published in 2015, was designed so that failing global systemically important banks (G-SIBs) will have sufficient loss-absorbing and recapitalisation capacity for authorities to implement an orderly resolution. Being able to implement orderly resolution minimises impacts on financial stability, maintains the continuity of critical functions, and avoids exposing public funds to loss. This technical review concludes that progress has been steady and significant in both the setting of external TLAC requirements by authorities and the issuance of external TLAC by G-SIBs. This has been instrumental in enhancing the resolvability of G-SIBs, strengthening cooperation between home and host authorities and boosting market confidence in authorities’ capabilities to address too-big-to-fail risks. |
Effective |
Disclaimer
This Reporter is prepared as a service for our clients. It is not intended to be a complete statement of the law or an opinion on any subject. Although we endeavour to ensure its accuracy, no one should act upon it without a thorough examination of the law after the facts of a specific situation are considered.
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