Federal Financial Institutions Legislative and Regulatory Reporter - December 2025

Published

Title and Brief Summary

Status (if applicable)

Office of the Superintendent of Financial Institutions (OSFI)

December 16, 2025

Data Collection Modernization Initiative: Get Ready for Implementation

This letter to industry reminds stakeholders of the timeline for the implementation of the Data Collection Modernization (DCM) project. The intent of this project is to modernize the regulatory data collection technology platform, and to advance key data initiatives and improve data quality. In 2026, OSFI will share technology implementation plan details in a number of forums (listed in the letter), and in early 2026 OSFI will begin to engage with relevant federally regulated banks on data initiatives.

Posted December 16, 2025.

Bank of Canada

December 19, 2025

Case Scenarios About Marketplaces [Retail Payments Supervision]

The Bank of Canada’s collection of case scenarios about marketplaces has been updated. New case scenarios include:

• registration refusals and revocations;
• safeguarding requirements;
• reporting and notification obligations;
• compliance scenarios observed during onboarding,

Updated December 19, 2025.

December 19, 2025

Frequently Asked Questions About Retail Payments Supervision

New questions and answers have been added to this document; they address commonly asked questions about the Bank’s supervisory expectations that were raised during a series of meetings with insurance and guarantee providers to support the development of end-user fund safeguarding insurance or guarantee products in Canada that satisfy the requirements under paragraph 20(1)(c) of the Retail Payment Activities Act (RPAA) and section 14 of the Retail Payment Activities Regulations (RPAR).

Updated December 19, 2025.

Financial Consumer Agency of Canada (FCAC)

December 9, 2025

FIFAI II: A Collaborative Approach to AI Threats, Opportunities, and Best Practices: Financial Well-Being and Consumer Protection

This summary report from FCAC and the Global Risk Institute summaries the findings of a workshop held November 13, 2025, by FIFAI II. The workshop examined AI risks, opportunities and best practices in the financial sector, and focused on financial well-being and consumer protection. Three key principles to support AI adoption and safeguard consumers:

• Inclusion by Design, meaning that financial institutions should integrate consumer interests from the outset when developing AI tools
• Innovation and Resilience, meaning that an innovative and resilient financial sector is generally to the benefit of consumers
• AI Literacy, meaning that as AI tools are rolled out across the financial sector, promoting AI literacy among consumers will improve access, inclusion, and consumer protection

A final report that draws conclusions from four FIFAI II workshops will be released in the Spring of 2026.

Published December 9, 2025.

Bank for International Settlements (BIS)

December 12, 2025

Review of the Implementation of Margin Requirements for Non-Centrally Cleared Derivatives

The Basel Committee on Banking Supervision (BCBS), together with the International Organization of Securities Commissions (IOSCO) has published a report that reviews the implementation of margin requirements for non-centrally cleared derivatives. It concludes that the framework has been implemented effectively, and it finds no evidence of material issues. The BCBS-IOSCO Working Group on Margining Requirements (WGMR) recommends ongoing monitoring through supervisory information exchange and the sharing of experiences among member authorities.

Published December 12, 2025.

December 10, 2025

Principles for the Sound Management of Third-Party Risk

The Basel Committee on Banking Supervision has published principles for the sound management of third-party risk in the banking sector: they are intended to establish a common baseline for banks and supervisors for the sound management of third-party risk.  With the growing digitalization of finance, banks have become increasingly dependent on third-party service providers for services that banks had previously not undertaken.  These new principles are meant to reflect this larger and more diverse third-party service provider environment in the banking sector.

Published December 10, 2025.

December 5, 2025

Machine-Readable Pillar 3 Disclosure: Consultation

The Basel Committee on Banking Supervision has launched a consultation on Machine-readable Pillar 3 disclosure. It proposes to make the data disclosed by banks (so-called Pillar 3 disclosures) available in a standardized machine-readable format. Although Pillar 3 disclosures by internationally active banks under the Basel Committee's standards are an important source of their key risk metrics, most banks currently publish their disclosures in PDF format only. This makes it difficult to aggregate, process and compare data across banks.

The proposed standard would introduce a requirement and technical specifications to produce machine-readable quantitative Pillar 3 disclosures, without changing the underlying disclosure requirements for banks. 

Comments are due March 5, 2026.

Financial Action Task Force (FATF)

December 22, 2025

Horizon Scan AI and Deepfakes

This document provides a forward-looking perspective on current and potential Artificial Intelligence (AI) related risks and trends. It forms part of the FATF’s staged approach to emerging technologies, with this study aiming to identify and explain developing risks and vulnerabilities associated with AI through the lens of Anti-Money Laundering, Countering the Financing of Terrorism, and Countering the Financing of Proliferation (AML/CFT/CPF).

Posted December 22, 2025.

International Association of Insurance Supervisors (IAIS)

December 15, 2025

Global Insurance Market Report (GIMAR) Special Section Excerpt: Insurance Adoption and Governance of AI

The adoption of AI systems is accelerating globally and is expected to have an economy-wide impact. In this excerpt, GIMAR explores how the trends in adoption and the ongoing evolution of AI may impact the insurance sector. For insurers, these developments offer commercial benefits across the insurance value chain. For consumers it could lead to faster underwriting decisions and more timely claims handling, thereby improving customer outcomes. However, with the adoption of AI comes risks that need to be effectively managed.  The report divides these risks into two categories:

• Risks from insurers’ own adoption of AI
• Balance sheet risks arising from the broader economy’s adoption of AI

Published December 15, 2025.

December 15, 2025

Global Insurance Market Report (GIMAR) Special Section Excerpt: Insurers’ Increasing Investments in Private Credit

Private credit has witnessed significant growth in recent years. While private credit is emerging as a key component of insurer’s investment strategies, its true measure is difficult to quantify due to the lack of a clear definition. For example, the inclusion in the definition of mortgage loans, a key insurer allocation, can increase the measurement significantly. With the objective of gathering more complete data, the IAIS is refining both the definition it uses to measure private credit and its data requests from supervisors.

Published December 15, 2025.

December 15, 2025

Global Insurance Market Report (GIMAR) Special Section Excerpt: Impact of Geoeconomic Fragmentation on Insurers’ Management of Assets and Liabilities

The global economy is increasingly contending with the complexities of geoeconomic fragmentation, driven by escalating geopolitical tensions and the growing shift of economic activities into regional or national blocs. This trend presents significant challenges to global growth and financial stability. These disruptions have the potential to spill over into macroeconomic and financial risks.  For insurers, such risks may require a strategic reallocation of asset and liability portfolios to address emerging vulnerabilities.

Published December 15, 2025.

Legislation

December 11, 2025

Bill C-12, Strengthening Canada’s Immigration System and Borders Act

Bill C-12 received first reading in the Senate on December 11, 2025

Bill C-12 would enact provisions put forward by Bill C-2, Strong Borders Act that are aimed at combating transnational organized crime, money laundering and the immigration system.  Bill C-12 would amend several Acts and regulations impacting financial institutions.

Part 9 amends the Proceeds of Crime (Money Laundering) and Terrorist Financing Act to, among other things,

1. Increase the maximum administrative monetary penalties that may be imposed for certain violations and the maximum punishments that may be imposed for certain criminal offences under that Act;
2. Replace the existing optional compliance agreement regime with a new mandatory compliance agreement regime that, among other things,
   1. Requires every person or entity that receives an administrative monetary penalty for a prescribed violation to enter into a compliance agreement with the Financial Transactions and Reports Analysis Centre of Canada (the Centre),
   2. Requires the Director of the Centre to make a compliance order if the person or entity refuses to enter into a compliance agreement or fails to comply with such an agreement, and
   3. Designates the contravention of a compliance order as a new violation under that Act;
3. Require persons or entities referred to in section 5 of that Act, other than those already required to register, to enroll with the Centre; and
4. Authorize the Centre to disclose certain information to the Commissioner of Canada Elections, subject to certain conditions.

Part 9 also makes consequential and related amendments to the Retail Payment Activities Act and the Proceeds of Crime (Money Laundering) and Terrorist Financing Administrative Monetary Penalties Regulations and includes transitional provisions.

Part 10 amends the Office of the Superintendent of Financial Institutions Act to make the Director of the Financial Transactions and Reports Analysis Centre of Canada a member of the committee established under subsection 18(1) of that Act. It also amends the Proceeds of Crime (Money Laundering) and Terrorist Financing Act to enable the Director to exchange information with the other members of that committee.

First reading in the Senate December 11, 2025.

Part 9 largely in force on Royal Assent, with certain sections in force on proclamation.

Part 10 in force on Royal Assent.

December 11, 2025

Bill C-13, Act to implement the Protocol on the Accession of the United Kingdom of Great Britain and Northern Ireland to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership

Bill C-13 received second reading in the House of Commons on December 11, 2025.

Bill C-13 implements the Protocol on the Accession of the United Kingdom of Great Britain and Northern Ireland to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, done July 16, 2023.  It includes consequential amendments to the definition of “regulated foreign entity” in sections 2 of the Bank Act, Insurance Companies Act and Trust and Loan Companies Act respectively. 

Second reading in the House of Commons December 11, 2025.

Act comes into force by proclamation.

December 10, 2025

Bill C-15, Budget 2025 Implementation Act, No. 1

Bill C-15 received second reading in the House of Commons on December 10, 2025.  Among its provisions to implement the 2025 Federal Budget, the following measures affect federally regulated financial institutions.

Division 9 of Part 5 repeals the Consumer-Driven Banking Act and enacts a new Consumer-Driven Banking Act to ensure that individuals and businesses can safely and securely share their data with the participating entities of their choice. That Act addresses, among other things, accreditation, national security, data sharing, security safeguards, consent, authentication, liability, complaints, administration and enforcement and screen scraping. The Division also makes related amendments to the Access to Information Act, the Financial Consumer Agency of Canada Act and the Budget Implementation Act, 2024, No. 1.

Division 10 of Part 5 amends the Trust and Loan Companies Act, the Bank Act and the Insurance Companies Act to extend the period during which federal financial institutions governed by those Acts may carry on business.

Division 11 of Part 5 amends the Trust and Loan Companies Act, the Bank Act and the Insurance Companies Act to, among other things, modernize prudential limits by repealing certain provisions that impose limits on federally regulated financial institutions with respect to debt obligations and borrowing, consumer and commercial loans and investments in real property and equity.

Division 12 of Part 5 amends the Bank Act, the Trust and Loan Companies Act and the Insurance Companies Act to allow for the electronic delivery of certain documents to shareholders, members and policyholders without their consent, while ensuring that they receive paper copies if they request them.

Division 13 of Part 5 amends the Trust and Loan Companies Act, the Bank Act and the Insurance Companies Act to increase the equity threshold related to the public holding requirement from $2 billion to $4 billion and to make changes to other provisions that include that threshold.

Division 14 of Part 5 amends the Trust and Loan Companies Act, the Bank Act, the Insurance Companies Act and the Office of the Superintendent of Financial Institutions Act to, among other things,

1. clarify the powers of the Superintendent of Financial Institutions in respect of the adherence by federally regulated financial institutions to their policies and procedures to protect themselves against threats to their integrity or security;
2. provide the Superintendent of Financial Institutions with powers to issue directions of compliance in respect of unsafe or unsound practices in the conduct of the affairs of those financial institutions; and
3. provide that the Superintendent of Financial Institutions is not prevented from disclosing information to any federal government agency or body for purposes related to the Superintendent’s regulation or supervision of financial institutions.

Division 15 of Part 5 amends the Bank Act to raise the amount of funds that can be withdrawn immediately from a retail deposit account after the deposit of a cheque or other instrument and to remove the delay for the withdrawal of funds deposited by a cheque or other instrument that is not deposited in person.

Division 16 of Part 5 amends the Bank Act to, among other things,

1. prohibit the activation of certain capabilities for a personal deposit account in Canada without the express consent of the natural person in whose name the account is kept;
2. permit a natural person in whose name such an account is kept to deactivate certain account capabilities;
3. permit a natural person in whose name such an account is kept to adjust certain transaction limits on the account;
4. require institutions to establish policies and procedures for detecting and preventing consumer-targeted fraud and mitigating its impacts; and
5. require institutions and the Commissioner of the Financial Consumer Agency of Canada to prepare annual reports on consumer-targeted fraud.

Division 17 of Part 5 amends the Canada Deposit Insurance Corporation Act, the Bank Act and the Financial Consumer Agency of Canada Act to support the growth of federal credit unions, including by way of amalgamation or asset acquisition and by permitting them to engage in motor vehicle leasing in certain circumstances.

Division 18 of Part 5 makes amendments to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act consequential to amendments to the Special Economic Measures Act.

Division 37 of Part 5 amends the Proceeds of Crime (Money Laundering) and Terrorist Financing Act to

1. clarify that all regulations made under that Act are to be made on the recommendation of the Minister of Finance;
2. clarify that paragraph 36(3.‍01)‍(b) of that Act applies to donations that are not charitable donations; and
3. prohibit the disclosure of reports, or the information contained in them, related to discrepancies in information discovered in the course of verifying the identity of persons having beneficial ownership or control of an entity.

It also amends the Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations to

1. clarify that paragraph 138(5)‍(b) of those Regulations applies to donations that are not charitable donations; and
2. clarify the application of those Regulations to mortgage administrators, mortgage brokers and mortgage lenders.

Division 45 of Part 5 enacts the Stablecoin Act, which imposes duties on persons that create stablecoins and make them available for purchase, directly or indirectly, by persons in Canada. That Act sets out the objects of the Bank of Canada in respect of stablecoin and requires the Bank to maintain a public registry of stablecoin issuers. That Act also addresses, among other things, the redemption of stablecoins by issuers, the reserve of assets that issuers must maintain to fulfill their redemption obligations and the policies that they must establish. The Division also makes consequential and related amendments to the Access to Information Act, the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and the Retail Payment Activities Act.

Second reading in the House of Commons December 10, 2025.

Part 5, Division 9 in force on Royal Assent.

Part 5, Division 10 in force on Royal Assent.

Part 5, Division 11 in force on proclamation.

Part 5, Division 12 in force on Royal Assent.

Part 5, Division 13 in force on Royal Assent.

Part 5, Division 14 in force on Royal Assent.

Part 5, Division 15 in force on proclamation.

Part 5, Division 16 in force on proclamation.

Part 5, Division 17 in force on proclamation, except ss. 337, 339(1), 340, 343, 344, 348, 349, 351 in force on Royal Assent.

Part 5, Division 18 in force on Royal Assent.

Part 5, Division 37 in force on Royal Assent, except s. 584 deemed to have come into force on October 1, 2025, immediately after the coming into force of section 8 of the Regulations Amending Certain Regulations Made Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act, made on December 16, 2024 and registered as SOR/2024-267.

Part 5, Division 45, s. 600 (enacting the Stablecoin Act) in force on proclamation; ss. 601 to 605 in force on proclamation.