Changes to Guideline A – Capital Adequacy Requirements (CAR)

Document Properties

  • Type of Publication: Letter
  • Date: August 21, 2017
  • Reference: Guideline for Banks/BHC/T&L/CRA
  • To:
    • Banks
    • Bank Holding Companies
    • Federally Regulated Trust and Loan Companies
    • Cooperative Retail Associations

OSFI is releasing for public consultation revisions to the CAR Guideline for implementation in Q1 2018Footnote 1. The revisions mainly relate to the treatment of allowances as a result of the expected adoption of IFRS 9 by deposit-taking institutions in 2018.

We recognize that IFRS 9 remains a work in progress for many institutions and in particular those using the standardized approach to credit risk. In order to inform OSFI’s decision on the need for a transition (or phase-in) of the impact of IFRS 9, we ask any institutions that project IFRS 9 to have a material impact on their capital position to provide estimated impacts to OSFI during this consultation so that appropriate mitigants can be considered.  OSFI Lead Supervisors will be contacting institutions regarding this issue.

In addition to the above changes related to IFRS 9 implementation, we have also provided clarifications throughout the CAR Guideline in response to questions received from the industry as part of our regular housekeeping process.  

With respect to the domestic implementation of the Standardized Approach to Counterparty Credit Risk (SA-CCR) and the revisions to the capital requirements for bank exposures to central counterparties (CCPs), we have chosen to extend the implementation timeline of these requirements given that the timing for implementation of these rules by the majority of key competitors in foreign markets is more likely to occur after January 2018.   

Our intention is to implement these rules in Q1 of 2019 subject to confirming the implementation readiness of key foreign market counterparties during 2018. However, although we are not implementing the SA-CCR as a minimum standard, we will be requiring institutions to start reporting amounts under SA-CCR beginning in Q1 2018. This information will be collected as part of the BCAR regulatory return through the introduction of an additional schedule.

We would also like to confirm our current expectations surrounding the domestic implementation of the revised securitization framework that was released by the BCBS in July 2016Footnote 2. OSFI expects to implement this framework in Q1 2019. This extended timeline will allow us to reflect the treatment related to simple, transparent, and comparable (STC) criteria for short term securitization exposures, which is yet to be finalized by the BCBSFootnote 3. As a result, the existing securitization treatment specified in the CAR Guideline will remain in place through the end of the 2018 fiscal year.

Questions and comments concerning these changes should be sent to Catherine Girouard, Director, Capital Division by e-mail at A non-attributed summary of industry comments received along with OSFI’s responses will be posted on OSFI’s website when the final version of the guideline is released. Comments should be provided no later than September 29, 2017.

Yours truly,

Carolyn Rogers
Assistant Superintendent
Regulation Sector


Footnote 1

November 1, 2017 for institutions with an October 31st year end and January 1, 2018 for institutions with a December 31st year end.

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Footnote 2

Revisions to the securitisation framework, BCBS, July 2016 (

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Footnote 3

On July 6, 2017, the BCBS released a consultative document on the Capital treatment for simple, transparent, and comparable short-term securitisations ( with comments due October 5, 2017.

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