Revisions to the capital floor

OSFI has released a letter announcing its decision to update the existing capital floor for institutions using advanced approaches for credit risk and operational risk. The current capital floor, based on the Basel I capital accord, will be replaced by a more risk-sensitive capital floor based on the Basel II framework. This interim step will improve the risk-sensitivity of the capital floor while ensuring the objectives of the floor continue to be met until the proposed implementation of the Basel III capital floor begins in 2022.