Featured Product

    Jamey Hubbs of OSFI Announces Bi-Annual Review of Buffer for D-SIBs

    January 23, 2019

    Jamey Hubbs of OSFI spoke in Toronto about the role of Domestic Stability Buffer and about positioning capital regime as part of the solution for stress situations, through transparency, prudent action, and "usability of capital." By making the Domestic Stability Buffer more transparent and its purpose and functioning more widely understood, he hopes that future increases or decreases to the buffer are seen as normal course of business and stabilizing actions, rather than market events unto themselves.

    He highlighted that the real test of a capital regime is whether and how that capital is used in times of stress to support stability. OSFI believes that an adjustable capital buffer, well communicated and understood, and responsive to conditions in the financial system is the way to achieve this objective. That is why, in June of 2018, OSFI publicly disclosed the Domestic Stability Buffer for the six largest banks in Canada, also known as the domestic systemically important banks, or D-SIBs. He said: "What that means is that we build up the Domestic Stability Buffer when vulnerabilities are high but conditions are more stable, and we release the buffer when needed so that banks can use that capital cushion in order to continue to provide loans and services to Canadians. As a result, the primary feature of the Domestic Stability Buffer is that it may very well increase during stable economic times and, specifically before the risks actually materialize." This only works in the context of regular transparent communication. As a result, twice a year, after assessing the prevailing economic conditions, OSFI will communicate publicly whether it will raise, maintain, or lower the Domestic Stability Buffer. This public announcement is a commitment to transparency OSFI has made regarding the capital being held by the largest banks in Canada.

     

    Related Link: Speech

    Keywords: Americas, Canada, Banking, D-SIBs, Systemic Risk, Domestic Stability Buffer, OSFI

    Featured Experts
    Related Articles
    News

    APRA Updates Validation and Derivation Rules in September 2020

    APRA updated the lists of the Direct to APRA (D2A) validation and derivation rules for authorized deposit-taking institutions, insurers, and superannuation entities.

    September 24, 2020 WebPage Regulatory News
    News

    EC Proposes Frameworks for Crypto-Assets and Operational Resilience

    EC adopted a package that includes the digital finance and retail payments strategies and the legislative proposals for regulatory frameworks on crypto-assets and digital operational resilience.

    September 24, 2020 WebPage Regulatory News
    News

    ECB Publishes Opinion on Proposals to Amend Securitization Framework

    ECB published an opinion (CON/2020/22) on proposals for regulations amending the securitization framework of EU, in response to the COVID-19 pandemic.

    September 24, 2020 WebPage Regulatory News
    News

    FCA Consults on Regulation of International Firms in UK

    FCA is consulting on its approach to the authorization and supervision of international firms operating in UK.

    September 23, 2020 WebPage Regulatory News
    News

    MAS Amends Notice on Capital Adequacy Requirements of Banks

    MAS published amendments to Notice 637 on the risk-based capital adequacy requirements for reporting banks incorporated in Singapore.

    September 23, 2020 WebPage Regulatory News
    News

    FCA to Begin to Move Firms to New Data Collection Platform RegData

    FCA announced that it will move firms to RegData from Gabriel in the coming months in stages, based on the reporting requirements of firms.

    September 23, 2020 WebPage Regulatory News
    News

    ISDA Expects IBOR Fallbacks to be Effective by End of January 2021

    ISDA issued a letter to regulators to flag that it now expects the supplement to the 2006 ISDA Definitions and the Interbank Offered Rate (IBOR) Fallbacks Protocol to be effective around mid- to late-January 2021.

    September 23, 2020 WebPage Regulatory News
    News

    APRA Reviews Repayment Deferral Plans, Identifies Best Practices

    APRA has concluded its review of the comprehensive plans of authorized deposit-taking institutions for the assessment and management of loans with repayment deferrals.

    September 22, 2020 WebPage Regulatory News
    News

    ESAs Assess Risks to Financial Sector After COVID-19 Outbreak

    ESAs (EBA, EIOPA, and ESMA) published the first joint report that assesses risks in the financial sector since the outbreak of the COVID-19 pandemic.

    September 22, 2020 WebPage Regulatory News
    News

    BoE Confirms Withdrawal of COVID Corporate Financing Facility

    BoE and HM Treasury confirmed that the COVID Corporate Financing Facility (CCFF) will close for new purchases of commercial paper, with effect from March 23, 2021.

    September 22, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 5836