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ARTICLE · 27 OCTOBER 2008

Canada Offers Guarantee Of Bank Debt

Stikeman Elliott LLP
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The Canadian government today announced a temporary program to guarantee mid to longer term debt issued by Canadian banks and other federally-regulated deposit-taking institutions.

CanadaFinance and Banking
Stikeman Elliott LLP
Stikeman Elliott LLP
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The Canadian government today announced a temporary program to guarantee mid to longer term debt issued by Canadian banks and other federally-regulated deposit-taking institutions. The Canadian Lenders Assurance Facility will insure certain categories of senior unsecured wholesale debt with a term to maturity of at least three months.

This insurance will cover principal and interest payments on eligible debt instruments for up to three years from the date of issue. Debt denominated in Canadian dollars, US dollars, Euros, Sterling or Yen is eligible for the program.


The facility will charge a base annualized premium of 135 basis points, with surcharges depending on the credit rating of the issuing institution and an additional surcharge for debt that is not denominated in Canadian dollars.Insurance will be available beginning in early November and will be issued until April 30, 2009. There is a limit on the amount of insurance available to each institution, based

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