Canada: Financial Sector Assessment Program-Technical Note on Crisis Preparedness and Safety Nets

International Monetary Fund

No 2025/232, IMF Staff Country Reports from International Monetary Fund

Abstract: This Technical Note focuses on Crisis Preparedness and Safety Nets in Canada. Canadian authorities can exercise a broad range of powers in resolution and the recovery and resolution toolbox is comprehensive and mature. The safety net for depositors in Canada is generally well developed, both at the federal and provincial level, but harmonization across the various schemes is recommendable. The federal deposit insurance coverage limit, last updated in 2005, needs reconsideration. A comprehensive resolution framework for insurance companies is still pending, though policyholders are protected by two industry-based guarantee funds. The dated legal regime for liquidation of financial institutions at the federal level remains functional, but requires an overhaul. While the flexibility of Winding-up and Restructuring Act (WURA) still allows it to deal with the complexity of modern financial conglomerates, even those with cross border activities, its lack of specific restructuring tools can leave space for interpretation which can lead to uncertainty. A comprehensive reform of the liquidation framework is needed.

Keywords: B. Resolution planning; loss absorption capacity requirement; B. Resolution power; restructuring provision; recovery planning; Ontario financing authority; Bank resolution framework; Crisis management; Deposit insurance; Credit unions; Insurance companies; Global (search for similar items in EconPapers)
Pages: 47
Date: 2025-08-01
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.imf.org/external/pubs/cat/longres.aspx?sk=569517 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:imf:imfscr:2025/232

Ordering information: This working paper can be ordered from
http://www.imf.org/external/pubs/pubs/ord_info.htm

Access Statistics for this paper

More papers in IMF Staff Country Reports from International Monetary Fund International Monetary Fund, Washington, DC USA. Contact information at EDIRC.
Bibliographic data for series maintained by Akshay Modi ().