Backgrounder: Draft Pillar 3 Disclosures for Interest Rate Risk Consultation

Overview

The Office of the Superintendent of Financial Institutions (OSFI) is launching a 60-day public consultation on draft amendments to the Pillar 3 Disclosure Guidelines for domestic systemically important banks (DSIBs) and small and medium‑sized banks (SMSBs). The proposed amendments incorporate the Basel Committee on Banking Supervision's interest rate risk in the banking book (IRRBB) disclosure standard. These amendments complement OSFI's work to reflect the Basel Committee's recalibration of interest rate shocks and strengthen expectations for IRRBB risk management. The proposed amendments do not affect capital or liquidity requirements.

Why it's important

OSFI is enhancing transparency and market discipline by consulting on updated IRRBB disclosure expectations that align with proposed amendments to Guideline B‑12 – Interest Rate Risk Management and global Basel standards. Interest rate risk is a core financial risk for deposit‑taking institutions. Clear, consistent disclosures help:

• strengthen market discipline by giving stakeholders better insight into how institutions measure and manage IRRBB
• improve transparency and comparability across institutions
• support sound risk management practices, contributing to a more resilient financial system

For SMSBs, OSFI proposes a proportional approach by applying the enhanced IRRBB disclosures only to Category 1 SMSBs and maintaining a focused set of qualitative disclosures.

Next steps

Stakeholders can share feedback to Pillar3-Pilier3@osfi-bsif.gc.ca until July 20, 2026. Comments received will inform the final amendments to the guidelines. OSFI plans to publish the final guidelines, along with a non-attributed summary of comments received and OSFI's responses, on September 10, 2026, with new disclosure requirements taking effect in fiscal reporting periods ending Q4 2027.