Prepare For Change: OSFI's Updated B-10 Guideline Reinforces Third-party Risk Management Requirements

On April 25, 2023 the Office of the Superintendent of Financial Institutions (OSFI) released a new revised version of its B-10 guideline on third-party risk management (the Guideline).

OSFI stated that starting from May 1, 2024, third-party arrangements of federally regulated financial institutions (FRFIs), including banks, federally regulated insurers, trusts, and credit unions, must adhere to the Guideline. For arrangements established before this date, they should be assessed and amended at the earliest opportunity in order to align with the May 1, 2024 effective date or as soon as possible thereafter.

Expanded scope from previous guideline B-10 on outsourcing

In contrast to the previous version of B-10, which focused on outsourcing arrangements, the new Guideline significantly expands its scope to encompass business and strategic arrangements with third parties broadly. In effect, this expanded scope now captures arrangements with entities such as, brokers,