Draft Letter Issued By OSFI - Capital Disclosure Requirements For Financial Institutions

On August 13, 2012, the Office of the Superintendent of Financial Institutions issued for public comment a draft letter (the "Draft Letter") that provides clarification on the implementation of the Basel Committee on Banking Supervision's final rules regarding the information that financial institutions must publicly disclose when detailing the composition of their capital (the "BCBS Disclosure Rules") for interim period from Q1-2013 and Q2-2013. As noted in the BCBS Disclosure Rules, during the financial crisis, many market participants found it difficult to make detailed assessments and cross jurisdictional comparisons of institutions' capital positions due to, among other things, the lack of consistency in public reporting. The new public capital disclosure requirements are, therefore, intended to improve both the transparency and comparability of institutions' capital positions.