Remarks for OSFI’s Quarterly Release Day

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Thank you, Christina.

My name is Catherine Girouard and I'm the Managing Director of the Banking Capital and Liquidity Standards Division at OSFI. With me today is Kenneth Leung, Managing Director of the Accounting Policy Division at OSFI.

I'm speaking from Ottawa, on the traditional unceded territory of the Algonquin Anishinaabe people.

Thank you for joining us for OSFI's second Quarterly Release Day of 2026.

Across recent public events, Superintendent Routledge has emphasized that a strong and resilient financial system is both a safeguard and a source of strength for the Canadian economy. He has also underscored that resilience is not static. It requires continuous attention to evolving risks, disciplined decision‑making, and the ability to adapt as conditions change.

That's why for this Quarterly Release, OSFI will continue to sharpen its oversight of the most significant risks facing the financial system, particularly credit, liquidity, and governance, as outlined in our Annual Risk Outlook for 2026–2027.

In this context, this Quarterly Release advances targeted initiatives that reinforce core prudential frameworks while supporting a more efficient and streamlined regulatory environment.

As OSFI continues to improve regulatory efficiency and eliminate duplication, these measures are focused on improving clarity, aligning expectations with risk, and ensuring institutions can direct resources to what matters most.

This quarter, we are advancing several initiatives across capital, liquidity, interest rate risk, and transparency.

First, on liquidity risk.

We are consulting on updates to the Liquidity Adequacy Requirements Guideline, or LAR, for 2027 as part of our regular review cycle.

As Superintendent Routledge has highlighted, liquidity risk can materialize quickly, reinforcing the importance of preparedness and forward-looking assessment.

These proposed updates aim to ensure liquidity requirements remain risk‑based and proportionate, while improving clarity and consistency and avoiding unnecessary constraints on institutions' ability to operate and support the broader economy.

Alongside this, we're launching a public consultation on a draft Internal Liquidity Adequacy Assessment Process, or ILAAP, Guideline.

This guideline strengthens institution-specific liquidity risk management by setting out clear, proportionate expectations based on size, business model, and risk profile, while also supporting more consistent supervisory assessment.

These initiatives strengthen both the core framework and institution-level liquidity risk management.

Turning now to broader capital-related initiatives.

We are also consulting on updates to Guideline B-2 on Large Exposure Limits for Small and Medium-Sized Banks, to modernize expectations for managing single-name concentration risk.

These proposed changes strengthen risk management and help maintain confidence in our financial institutions and the broader financial system.

Draft updates to the Capital and Liquidity Treatment of Crypto-asset Exposures Guideline for banks ensure that risks associated with this evolving asset class continue to be addressed through appropriate prudential safeguards.

The draft updates are targeted and reflect developments in crypto‑asset markets and how our banks participate in them. They are designed to ensure capital and liquidity requirements for crypto‑asset exposures remain prudent and appropriately calibrated to risk, while allowing banks to appropriately recognize risk‑reducing hedging practices between certain regulated exchanges.

These measures ensure that capital frameworks remain responsive to evolving and, in some cases, more concentrated risks.

In parallel, we are also consulting on targeted updates to Guideline B-12 – Interest Rate Risk Management, ensuring that shock scenarios and methodologies remain current and risk-sensitive.

Together, these initiatives strengthen OSFI's prudential framework and support resilience across the financial system.

I will turn it over to Kenneth Leung to discuss interest rate risk management and disclosure.

Thank you Catherine.

We are consulting on draft amendments to Pillar 3 disclosure expectations on interest rate risk in the banking book.

These changes support transparency and market discipline, while remaining limited in scope and aligned with international standards. 

We updated the Guide to Intervention for Deposit Taking Institutions.

These updates reinforce OSFI's emphasis on clear expectations and early risk identification, particularly as integrity and security risks continue to evolve. There is no action required from institutions.

Lastly, we are also enhancing transparency through the introduction of public disclosure of federally regulated institutions' crypto-asset exposures (first announced in Budget 2023.)

Beginning in spring 2026, OSFI will publish this information through the Open Government data portal.

This measure improves visibility into crypto-asset risks and supports financial system stability.

Separately, OSFI is undertaking early analytical work to assess whether insurance Minimum Capital Test risk factors—largely unchanged for more than a decade—remain appropriate in today's risk environment.

Across all of these initiatives, OSFI's approach remains consistent.

We are focusing on the risks that matter most, ensuring our expectations are clear and proportionate, and continuing to streamline our regulatory framework.

Taken together, these measures reflect OSFI's shift toward more focused, risk-based oversight, strengthening resilience while reducing unnecessary complexity and supporting institutions' ability to operate with clarity and confidence.

Thank you for joining us.

I will now turn it over to Christina to moderate the Q&A.