LAR guideline review for wholesale funding sources with retail-like characteristics

Document properties

  • Type of publication: Letter
  • Date: May 10, 2023
  • To: Deposit-Taking Institutions (DTIs)

OSFI is launching a review of the liquidity treatment provided in the Liquidity Adequacy Requirements (LAR) Guideline for wholesale funding sources with retail-like characteristics, such as high-interest savings account exchange traded funds (HISA ETFs). In a rising rate environment, these products have seen significant growth as they aim to mimic traditional savings accounts through an ETF structure while offering higher yields. The higher yield is supplemented by the product’s liquidity, as clients’ withdrawals are usually not subject to restrictions.

The purpose of this review is to assess the need for new wholesale funding categories to appropriately reflect the risks of such retail-like wholesale products. Further, OSFI will also analyze any similar types of products with retail characteristics, but which banks access via a financial institution’s intermediation.

OSFI welcomes comments, analyses, and proposals about the liquidity treatment of wholesale funding products with retail-like characteristics, particularly on the following questions:

  1. Does the LAR Guideline currently appropriately reflect the risk profile for products sourced from other financial institutions that have retail-like characteristics? If not, please identify areas where additional categorization would be appropriate.
  2. For any relevant exposures, please share applicable data or stress-testing models on unitholder composition and redemption history, as well as any other supporting rationale for preferential liquidity treatment.
  3. What contractual mitigating features and/or stabilizing mechanisms are in place that might warrant a differentiated liquidity funding value for relevant exposures within the LAR Guideline?

If OSFI concludes that new wholesale funding categories are warranted in the LAR Guideline, the earliest implementation date for new categories would be in the 2024 calendar year. In the interim, the current framework remains applicable and wholesale funding from financial institutions must receive the treatment per the LAR Guideline (100% run-off at earliest possible maturity redemption in Liquidity Coverage Ratio; 0% Available Stable Funding factor in Net Stable Funding Ratio). Any DTIs needing to transition liquidity measurement related to HISA ETFs will have until August 1, 2023.

Input is requested by June 21, 2023 and should be sent to


Ben Gully
Deputy Superintendent
Supervision Sector