Trend Spotting

One of the most difficult missions for any compliance team is to provide business leaders with advance warning of regulatory trends that can impact their businesses.  With Trend Spotting we hope to provide some insight into what we see on the horizon. Our first issue looks at developments at the G20 that may find their way into the Canadian regulatory landscape. 

On March 21, 2013, Finance Minister Jim Flaherty introduced a new federal budget.  Contained within the budget were several measures that will introduce new or amended regulatory requirements for the financial sector or that may impact on the structure of the sector.  This article contains a summary of those measures.

Click here to read the full article.

In our last issue, we addressed developments on the international front that could impact Canada’s regulatory structure and financial institutions' compliance programs. One of the issues we highlighted was the Financial Stability Board’s assessment of Canada and its concern that consumer debt remains at too high a level. We indicated that additional regulation directed at consumer lending was very likely as Canada has a strong history of reacting to the criticisms of international agencies.

On March 19^th OSFI released draft guidance covering residential mortgage underwriting practices, including a new 65% cap on loan-to-value ratios for home equity lines of credit (HELOC). While the guidance is intended to ensure that institutions maintain sound lending practices, clearly reducing the availability of HELOCs could lead to lower levels of consumer debt.

Unfortunately, our Trendspotting issue came out on only 18 days before the OSFI guidance. So, while we are happy that we reported on the issue, we would like to have reported on it a bit earlier!

So, here we go again. We have kept mortgage lending on our watch list and are adding the payments system, corporate governance and privacy. Here’s why.

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Since the 2008 financial crisis, governments and regulators have redoubled their efforts to ensure that there is a consistent standard of regulation across jurisdictions. As a result, much of the regulatory change since the crisis has been developed by international organizations such as the G20 and the Financial Stability Board (FSB) and the industry specific organizations such as the Basel Committee on Banking Supervision, the International Organization for Securities Commissions and the International Association of Insurance Supervisors.

So, what are some of the trends developing from these international forums? The G20 leaders and the finance ministers met most recently in November 2011 and February 2012, respectively. At these meetings, they endorsed much of the work being produced by the industry specific organizations and indicated their intention to implement the proposals in the near term.

This article describes some of those proposals and what they may mean for the regulatory landscape in Canada.

Click here to read the full article