Office of the Superintendent of Financial Institutions
Letters of credit (LOC) for unregistered reinsurance are considered a direct credit substitute. They are subject to risk factors based on the credit rating of the issuing/confirming bank and the term of the liabilities covered by the reinsurance contracts held. OSFI will recognize an approved LOC as security for the purposes of:
To improve efficiency in the issuance of LOC approvals, OSFI is amending its process to reduce the amount of time LOCs spend in transit. In summary:
Guideline is effective as of the date of this letter.
Questions related to this Guideline can be directed to