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ARTICLE · 09 FEBRUARY 2011

Banking Regulation In Canada

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There are several overarching policy objectives that Canada uses as a framework for establishing the rules of the banking sector.

CanadaFinance and Banking
Blair Keefe
Blair Keefe
Sanjit Sodhi
Sanjit Sodhi
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Originally published in Banking Regulation | 2010

1 What are the principal governmental and regulatory policies that govern the banking sector?

There are several overarching policy objectives that Canada uses as a framework for establishing the rules of the banking sector.

From a capital perspective, Canada strongly believes that Canadian banks should meet international best practice for capital and was an early adopter of the Basel II Capital Accord as the basis for establishing the capital requirements for domestic banks.

Second, Canada believes that large banks that are important to the economy should be free from the influence of any one shareholder. To implement this policy, Canada imposes a widely held requirement in respect of its largest and most important banks.

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