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ARTICLE · 19 AUGUST 2017

Canadian Government Tables Bail-In Regulations

Borden Ladner Gervais LLP
Borden Ladner Gervais LLP
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The Canadian government is now seeking to fully implement a bail-in regime in Canada through three proposed regulations

CanadaFinance and Banking

Background

Following the Canadian government's commitment in Budget 2016 to implement a bail-in regime, and the subsequent creation of a legislative framework for such a regime through amendments to the Bank Act and Canada Deposit Insurance Corporation Act (the "CDIC Act"), the Canadian government is now seeking to fully implement a bail-in regime in Canada through three proposed regulations. Once implemented, the regime will allow authorities to convert shares (essentially, preferred shares) and certain liabilities (collectively, "bail-in eligible securities") of a failing domestic systemically important bank ("DSIB")1 into common shares to recapitalize the bank and allow it to remain in operation.

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