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ARTICLE · 09 MARCH 2018

Close-Out Rights In A Resolution Scenario: New CDIC Guidance

Stikeman Elliott LLP
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On March 1, 2018, Canada Deposit Insurance Corporation (CDIC) released its updated Guidance on the Exercise of Eligible Financial Contracts Close-out Rights in a Resolution Scenario.

CanadaFinance and Banking
Stikeman Elliott LLP
Stikeman Elliott LLP
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On March 1, 2018, Canada Deposit Insurance Corporation (CDIC) released its updated Guidance on the Exercise of Eligible Financial Contracts Close-out Rights in a Resolution Scenario. This new Guidance reflects 2017 amendments to provisions of the Canada Deposit Insurance Corporation Act (CDIC Act) dealing with stays on close-out of eligible financial contracts (EFCs). It's very nice when complicated legislation comes with Guidance from the very folks that would have to put it into action, although hopefully they never will.

Last October, we posted about the amendments themselves. Those of you who grabbed your copy of the Canadian ISDA opinions as soon as they were hot off the press will no doubt have avidly read all about them in the update. But for the stragglers who are still catching up with recent developments, a few highlights of the resolution stay, as described in the Guidance note, are set out below.

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