Featured Product

    OSFI Issues Advisory on MICAT Total Requirements for FTHBI Mortgages

    September 03, 2019

    OSFI issued an advisory, along with an impact analysis statement for mortgage insurers, defining the capital requirements for insured mortgages under the new First-Time Home Buyer Incentive insured (FTHBI) program. The advisory, in conjunction with the Mortgage Insurer Capital Adequacy Test (MICAT) guideline, sets out the regulatory framework within which OSFI assesses whether a mortgage insurance company maintains adequate capital for FTHBI insured mortgages. The advisory will become effective from November 01, 2019. OSFI also published a guideline impact statement. OSFI will monitor the effectiveness of the new advisory and make any necessary modifications.

    At present, the MICAT is not designed to capture the mortgage insurance risk associated with FTHBI mortgages compared to non-FTHBI mortgages with the same risk drivers such as loan-to-value and outstanding balance. OSFI took the following steps to develop an approach to capture the risks associated with FTHBI mortgages and calculate their total requirements in the MICAT:

    • Identified the risks associated with FTHBI mortgages
    • Measured the risks using the methodology that is used to determine the total requirement formulas in the MICAT
    • Designed an approach to calculate total requirements for FTHBI mortgages that uses the existing total requirement formulae
    • Determined a suitable calibration for recommended approach consistent with measurement of the risk

     

    Related Links

    Effective Date: November 01, 2019

    Keywords: Americas, Canada, Insurance, FTHBI Mortgages, Capital Adequacy, Mortgage Insurers, First Time Home Buyers, Credit Risk, OSFI

    Related Articles
    News

    FED Proposes to Extend Data Collection Under Stress Testing Guidance

    FED proposed three-year extension, without revision, of the information collection FR 4202, titled "Recordkeeping Provisions Associated with Stress Testing Guidance."

    March 08, 2021 WebPage Regulatory News
    News

    FCA Proposes Updates to Guidance on Mortgage Repossessions

    FCA updated the draft guidance for firms to ensure that mortgage customers whose homes may be repossessed are treated fairly and appropriately, particularly where there are risks of harm to customers who are vulnerable as a result of the COVID-19 pandemic.

    March 05, 2021 WebPage Regulatory News
    News

    FCA Announces Cessation Timeline for Certain LIBOR Benchmark Settings

    FCA issued a statement on the cessation or loss of representativeness of the 35 LIBOR benchmark settings published by ICE Benchmark Administration or IBA.

    March 05, 2021 WebPage Regulatory News
    News

    EBA Publishes Reporting and Disclosures Framework for Investment Firms

    EBA published a package that includes the final draft implementing technical standards on supervisory reporting and disclosures of investment firms.

    March 05, 2021 WebPage Regulatory News
    News

    BIS Examines Use of Big Data and Machine Learning at Central Banks

    BIS published a paper that provides an overview on the use of big data and machine learning in the central bank community.

    March 04, 2021 WebPage Regulatory News
    News

    APRA Finalizes Reporting Standard for Operational Risk Requirements

    APRA finalized the reporting standard ARS 115.0 on capital adequacy with respect to the standardized measurement approach to operational risk for authorized deposit-taking institutions in Australia.

    March 03, 2021 WebPage Regulatory News
    News

    ECB Publishes Guide for Determining Penalties for Regulatory Breaches

    ECB published a guide that outlines the principles and methods for calculating the penalties for regulatory breaches of prudential requirements by banks.

    March 02, 2021 WebPage Regulatory News
    News

    MAS Sets Out Good Practices to Manage Operational Risks Amid COVID

    MAS and The Association of Banks in Singapore (ABS) jointly issued a paper that sets out good practices for the management of operational and other risks stemming from new work arrangements adopted by financial institutions amid the COVID-19 pandemic.

    March 02, 2021 WebPage Regulatory News
    News

    ACPR Announces New Data Collection Application for Banks and Insurers

    ACPR announced that a new data collection application, called DLPP (Datalake for Prudential), for collecting banking and insurance prudential data will go into production on April 12, 2021.

    March 02, 2021 WebPage Regulatory News
    News

    BCB Maintains CCyB at 0%, Initiates First Cycle of Regulatory Sandbox

    BCB announced that the Financial Stability Committee decided to maintain the countercyclical capital buffer (CCyB) for Brazil at 0%, at least until the end of 2021.

    March 02, 2021 WebPage Regulatory News
    RESULTS 1 - 10 OF 6659