Superintendent Routledge participates in a fireside chat at the Global Risk Institute Summit 2025

Check against delivery

Moderator:

You’ve said OSFI is looking to reduce regulatory burden where possible. Can you give us some concrete examples of where you see opportunities to do that, while still maintaining resilience?

Superintendent Peter Routledge:

• On August 18, I laid out how we are continuing to make regulatory efficiency a discipline in OSFI. We’re reducing the scope and timing of certain integrity and security data requests, shifting the corporate governance consultation to focus on the most material issues, and eliminating redundant data collections. Those changes free up capacity without compromising resilience.
• On supervision, we’re being more measured in how we apply intensity. Operational risk supervision is tough — and rightly so — but we’re recalibrating how we stage and intervene, so the oversight matches the risk profile, not a one-size-fits-all approach.
• In capital, we’re making targeted adjustments. We paused Basel III implementation of the “output floor” to ensure that competitive balance prevails for Canadian banks that compete in the international banking system and to provide Canadian banks with transparency and predictability in OSFI’s capital expectations.
• At the same time, we’re not loosening everywhere. On anti-money laundering, for instance, the trajectory is still tighter — because the risk environment demands it.

Moderator:

You’ve said AML is a prudential issue. With the federal Strong Borders Act (Bill C-2) on the table and the Financial Action Task Force (FATF) review coming up later this year, how concerned are you about AML right now — and what’s changing in how OSFI will supervise it?

Superintendent Peter Routledge:

• AML is a prudential risk. Weak AML controls can erode integrity and confidence, which in turn threaten safety and soundness. That’s why we treat AML as part of our integrity and security risk lens and a priority in our risk outlook.
• No other regulator has a mandate to ensure federally regulated financial institutions (FRFIs) have policies and procedures in place to protect themselves from threats to their integrity and security and from foreign interference.
• Our Integrity and National Security team engages closely with domestic security and intelligence partners as well as our international counterparts to identify threats to FRFIs. By bringing together classified and unclassified information, our team can look at a holistic picture of the integrity and security risks institutions face. That includes influence from foreign jurisdictions.
• Bill C-2 strengthens coordination. If Parliament passes Bill C-2, FINTRAC will join the Financial Institutions Supervisory Committee (FISC). I would be very pleased to welcome FINTRAC at that table. It will facilitate information exchange and allow us to respond more quickly through supervision.

Moderator:

To what extent are OSFI’s actions driven by what happens south of the border, especially when we see deregulatory trends in the United States?

Superintendent Peter Routledge:

• Canada’s financial system is navigating a period of profound uncertainty. From escalating geopolitical instability and cyber threats to climate change and domestic economic shifts, the risks facing financial institutions are complex and consequential. Canada is a North American economy, and our banks and insurers compete in the U.S. market, so we cannot ignore changes in their regulatory environment.
• 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. That resilience is a strategic advantage that can be leveraged to support growth in the Canadian economy. This is not a departure from our core mandate: it’s a bold extension of it. A strong, stable financial system isn’t just a safeguard—it’s a catalyst for national prosperity.
• OSFI has proactively established an annual discipline of refining our regulatory guidelines and advisories to find opportunities to remove unnecessary burden. Our focus has been clear: reduce regulatory burden where possible, sharpen our focus on the most important risks, and ensure institutions remain resilient in an uncertain risk environment.
• We adjust when necessary. For example, last year we paused the Basel III output floor because the gap with international peers, including the U.S., had widened beyond what we were comfortable with. That was about preserving a fair playing field while keeping resilience intact.
• With an unwavering focus on a sound financial system, innovation, and public confidence, we will continue to enable Canadian financial institutions to play a central role in building Canada’s economic strength.

Moderator:

If we see more deregulation in the U.S. and tariffs start to have more impact, how will OSFI make sure Canada stays competitive while still maintaining its risk posture?

Superintendent Peter Routledge:

• We will be proactive. You can expect us to act early, not wait. When risks shift, we look ahead, anticipate, and adjust our approach before Canadian institutions are at a disadvantage.
• Our approach is incremental. We make changes in measured steps, not sudden swings. That gives boards and executives clarity and time to adjust, while ensuring the system stays safe.
• A strong, stable financial system isn’t just a safeguard — it’s a catalyst for national prosperity. Canada’s financial system is built on resilience, and that resilience is a strategic asset.
• We respond with prudence. Whether it’s tariffs or U.S. deregulatory moves, you should expect a prudent response: one that protects depositors and policyholders while enabling institutions to support Canada’s economy through uncertain times.

Moderator:

What is OSFI doing that might help small and medium-sized businesses access the capital they need to grow?

Superintendent Peter Routledge:

• We continue to work to identify where and how we can best align capital requirements with actual risk. Regulatory efficiency reduces unnecessary capital strain without compromising safety and soundness and supporting the competitiveness of our financial institutions where warranted. This frees up capacity that banks can use to extend more credit.
• More broadly, OSFI has been focused on regulatory efficiency where possible, by honing on the most important risks, and ensuring institutions remain resilient in an uncertain world. We have proactively established an annual discipline of refining our regulatory guidelines and advisories to find opportunities for regulatory efficiency.