Bank of Canada’s Intention to Introduce a Standing Term Liquidity Facility
The Bank of Canada (Bank) is announcing its intention to introduce a new liquidity facility, the Standing Term Liquidity Facility (STLF). The STLF will complement the Bank’s current tools for the provision of liquidity and will strengthen the Bank’s role as lender of last resort. The Bank is committed to regularly reviewing its Framework for Market Operations and Liquidity Provision to ensure it remains consistent with the ongoing evolution of the Canadian financial system. Under the proposed STLF, the Bank could provide loans to individual prudentially regulated members of Payments Canada that are experiencing idiosyncratic stress where the Bank has no concerns about their financial soundness. The addition of the STLF is another step in the Bank’s efforts to enhance the resilience of the Canadian financial system.
The Bank plans to conduct targeted industry consultations to refine the design of the STLF. Other interested stakeholders are welcome to provide comments on the proposed design by email to STLF-consultation@bank-banque-canada.ca by December 13, 2019.
For further information, please contact:
Scott Kinnear
Director
Financial Markets Department
Bank of Canada
613-782-7723
Natasha Khan
Director
Financial Stability Department
Bank of Canada
613-782-7971
Media Relations
Bank of Canada
613-782-8782