OSFI releases fall risk update reinforcing resilience amid global trade uncertainty

Today, OSFI released its fall update to the 2025-2026 Annual Risk Outlook (ARO). This semi-annual update outlines how risks to the Canadian economy have evolved since the spring ARO, and how OSFI is addressing these risks.

In March, OSFI identified four key risks:

• Integrity and security risk
• Wholesale credit risk
• Funding and liquidity risk
• Real estate secured lending and mortgage (RESL) risks

While these four risks remain, today’s update emphasizes two additional risks related to tariffs and housing market strains. Despite these challenges, OSFI judges that Canada’s financial institutions are sufficiently resilient to absorb these risks and remain well positioned to manage a downturn.

To address these risks, OSFI will undertake the following actions:

• Continue to assess adherence to Guideline B-20’s principles on prudent underwriting standards, portfolio management, and account management practices.
• Examine adherence to the newly implemented loan-to-income measure and assessing mortgage lenders’ variable-rate mortgages with fixed payments risk management practices.
• Incorporate consultation feedback into further liquidity risk guideline updates and consultations through 2026.
• Strengthen institutional preparedness for stress events.
• Remain ready to take measures where appropriate to alleviate constraints on institutions and ensure that the Canadian financial system can leverage its built-up financial resilience.

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Over the last 15 years, OSFI has built enduring resilience into Canada’s financial system. These efforts have proven to be both necessary and effective. Our Annual Risk Outlook is one of the tools we use to identify the most significant risks on the horizon and to guide our supervisory and regulatory priorities. Building that resilience is a strategic advantage that can be leveraged to support growth in the Canadian economy.