Financial System Review - June 2018

June 7, 2018
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This issue of the Financial System Review reflects the Bank’s judgment that high household indebtedness and housing market imbalances remain the most important vulnerabilities. While these vulnerabilities remain elevated, policy measures continue to improve the resilience of the financial system. A third vulnerability highlighted in the FSR concerns cyber threats to an interconnected financial system.
Content Type(s): Publications, Financial Stability Report
June 7, 2018

Establishing a Resolution Regime for Canada’s Financial Market Infrastructures

Financial System Review - June 2018 Elizabeth Woodman, Lucia Chung, Nikil Chande
This report highlights how an effective resolution regime promotes financial stability. It does this by ensuring that financial market infrastructures (FMIs) would be able to continue to provide their critical functions during a period of stress when an FMI’s own recovery measures were failing. The report explains the Bank of Canada’s new role as the resolution authority for FMIs, which will further bolster financial system resilience.
Content Type(s): Publications, Financial System Review articles Topic(s): Financial institutions, Financial markets, Financial stability, Financial system regulation and policies, Payment clearing and settlement systems JEL Code(s): G, G1, G10, G19, G2, G20, G28, G29
June 7, 2018

Covered Bonds as a Source of Funding for Banks’ Mortgage Portfolios

Financial System Review - June 2018 Toni Ahnert
The author traces developments in the Canadian covered bond market. Covered bonds could be a valuable way to provide a stable and diverse source of funding, particularly for smaller banks. However, higher issuance could increase banks’ vulnerability to liquidity stress, with implications for the broader financial system. The author argues that these benefits and challenges can be balanced in a well-designed policy framework.
Content Type(s): Publications, Financial System Review articles Topic(s): Financial institutions, Financial stability, Financial system regulation and policies JEL Code(s): G, G1, G2, G21, G28
June 7, 2018

The Bank of Canada’s Financial System Survey

Financial System Review - June 2018 Guillaume Bédard-Pagé, Ian Christensen, Scott Kinnear, Maxime Leboeuf
This report presents the details of a new semi-annual survey that will improve the Bank of Canada’s surveillance across the financial system and deepen efforts to engage with financial system participants. The survey collects expert opinions on the risks to and resilience of the Canadian financial system as well as on emerging trends and financial innovations. The report presents an overview of the survey and provides high-level results from the spring 2018 survey.
Content Type(s): Publications, Financial System Review articles Topic(s): Financial institutions, Financial markets, Financial services, Financial stability, Financial system regulation and policies, Recent economic and financial developments JEL Code(s): C, C8, C83, G, G1, G11, G18, G2, G28, G3, G32

Press Conference

Press conference by Governor Stephen S. Poloz and Senior Deputy Governor Carolyn A. Wilkins. (11:15 (ET) approx.).

Press Release

High household indebtedness and housing market imbalances remain the most important vulnerabilities identified by the Bank of Canada in its Financial System Review (FSR), published today. While these vulnerabilities remain elevated, policy measures continue to improve the resilience of the financial system.

Content Type(s): Press, Press releases

Opening Statement

Opening statement - ,

Press conference following the release of the Financial System Review.

Content Type(s): Press, Speeches and appearances, Opening statements
Topic(s): Credit and credit aggregates, Financial stability, Financial system regulation and policies, Housing, Regional economic developments, Sectoral balance sheet

The 2-minute FSR