Financial system

A stable and efficient financial system is essential for sustained economic growth and rising living standards.

The Bank of Canada promotes the economic and financial welfare of Canada by fostering a stable and efficient financial system, which includes banks and credit unions, the financial markets, and clearing and settlement systems. The Bank does this by:

In addition to promoting a sound financial system at home, the Bank contributes to international discussions on important financial system issues, collaborates with other central banks on research into the international financial system and provides technical assistance. The Bank of Canada:

Financial System Hub

Financial System Hub

Promoting a stable and efficient financial system.

Provision of liquidity to the financial system

The Bank of Canada is the ultimate source of liquid funds to the financial system, and serves as the system’s “lender of last resort.” The deployment of its routine and emergency liquidity tools are guided by the Bank’s framework for market operations and liquidity provision.

Oversight and resolution of financial market infrastructures

Under the authority of Canada’s Payment Clearing and Settlement Act, the Bank conducts regulatory oversight for designated financial market infrastructures (FMIs) and acts as the resolution authority for domestic designated FMIs. These include systemically important payment systems and clearing and settlement systems. Oversight is conducted according to the Bank of Canada’s Risk-Management Standards for Designated FMIs.

Analysis and research

Assessing financial stability

Bank staff conduct analysis and research to identify and mitigate systemic risks that might impair the functioning of the financial system. The results are published once a year in the Financial Stability Report.

Financial System Research Centre

The FSRC promotes financial system research in Canada to inform policy and improve the economic and financial well-being of Canadians.


Financial system committees

The Bank of Canada collaborates with federal, provincial and international authorities as well as industry to achieve its financial system goals.

Retail payments supervision

Under the Retail Payment Activities Act, the Bank of Canada will be responsible for supervising payment service providers. Our aim is to build confidence in the safety and reliability of their services while protecting users from certain risks. Payment service providers will be required to register with the Bank and to comply with requirements for operational risk management and safeguarding end-user funds.