On June 1st, 2014, IIROC released a code of conduct for the Canadian Dollar Offered Rate (“CDOR”). A copy of the Code can be accessed here. The Code lays out new standards for how banks submit CDOR, internal supervision  of the rates and record keeping. In confirming that all CDOR panel members must now be only banks as opposed to investment dealers, it also clarified that the CDOR acronym stands for “Canadian Dollar Offered Rate” and not “Canadian Dealer Offered Rate”. This is significant as it means that IIROC should have no supervisory role over CDOR in future.

CDOR’s purpose is to establish a daily benchmark reference rate for Bankers Acceptance borrowings and is also used to form the floating benchmark rate for Canadian dollar derivatives including, interest rate swaps, floating  rate notes and as the final settlement price for future contracts. Every business day before 10:15 a.m., each Bank submits a bid which represents the rate at which the Bank would be willing to lend funds against Primary Bankers Acceptances Market issuances to clients. CDOR is then calculated by taking the average of these Bids after removing the highest and lowest submissions.

The Code was developed by Canadian Submitting Banks in consultation with IIROC and the Bank of Canada. It serves as a part of a response to recent reviews of CDOR supervisory practices conducted by IIROC and the Board of International Organization of Securities Commissions.

A few days before the Code was released, on May 30, 2014, the Office of the Superintendent of Financial Institutions (“OSFI”) announced that it was proposing to make senior management of the Submitting Banks responsible for developing new guidelines for submissions to CDOR. The OSFI proposal can be accessed here.

These recent developments and the growing interest in CDOR are inextricably tied to U.K. and U.S. regulatory investigations and prosecutions of the benchmark, LIBOR, however, OSFI has noted that there have been no similar reports of CDOR manipulation in Canada, to date.


Maureen Doherty 


Litigation and Arbitration
Securities Litigation