The Reporter provides a monthly summary of Canadian federal legislative and regulatory developments of relevance to federally regulated financial institutions. It does not address Canadian provincial financial services legislative and regulatory developments. In addition, purely technical and administrative changes (such as changes to reporting forms) are not covered.
May 2026
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Published |
Title and Brief Summary |
Status (if applicable) |
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Office of the Superintendent of Financial Institutions (OSFI) |
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May 21, 2026 |
Draft Guideline B-12 Interest Rate Risk Management Consultation OSFI has informed banks and trust and loan companies by letter of a consultation with respect to targeted adjustments to Guideline B‑12 – Interest Rate Risk Management. The adjustments would update the interest rate shock scenarios in the guideline to align with recent revisions from the Basel Committee on Banking Supervision (BCBS). BCBS published its revised Recalibration of shocks for interest rate risk in the banking book in July 2024. The guidance would also be updated with respect to how institutions should consider different types of balance sheet scenarios against earnings measures. In addition, details related to public disclosures would be replaced by a reference to OSFI’s Pillar 3 disclosure guidelines. The current version of Guideline B-12 was published in May 2019. The letter and draft Guideline are accompanied by a Backgrounder. |
Comments are due July 20, 2026. The guideline will come into effect on November 1, 2026 (for October 31 year ends) or January 1, 2027 (for December 31 year ends) |
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May 21, 2026 |
Draft Capital and Liquidity Treatment of Crypto-asset Exposures (Banking) Guideline (2027) OSFI has informed banks and trust and loan companies by letter of a consultation with respect to draft revisions to the Capital and Liquidity Treatment of Crypto-asset Exposures (Banking) Guideline. OSFI states that the revisions, building on the latest version of the guidance (in effect in Q1 2026), are meant to respond to developments in the crypto market, but also ensure that the capital and liquidity treatment of crypto‑asset exposures continues to reflect the underlying risks faced by institutions, and remains prudent in light of the dynamic nature of the crypto market. Targeted revisions would recognize cross‑exchange hedging for Group 2a crypto‑assets traded on regulated exchanges. OSFI states that the current draft revision does not address several key issues noted in its October 29, 2025, letter to industry, such as the risk weight applied to Group 2a crypto‑assets and Group 2a crypto-assets’ eligibility as collateral. The draft guideline is accompanied by a backgrounder. |
Comments are due July 20, 2026. Final version of revised guideline will come into effect on November 1, 2026, or January 1, 2027 for institutions with a fiscal year ending October 31 or December 31, respectively. |
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May 21, 2026 |
Draft Liquidity Adequacy Requirements Guideline (2027) OSFI has informed banks and trust and loan companies by letter of a consultation with respect to draft revisions to the Liquidity Adequacy Requirements (LAR) Guideline. OSFI states that the revisions are aimed at ensuring that liquidity requirements continue to align with the underlying risk faced by institutions; at enhancing the clarity of its liquidity rules; and at improving the consistency of the application of those rules. It proposes:
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Comments are due July 20, 2026. Final version of revised guideline will come into effect May 1, 2027. |
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May 21, 2026 |
Consultation on Pillar 3 Disclosure Guidelines for Interest Rate Risk in the Banking Book OSFI has informed Banks and Trust and Loan Companies by letter of a consultation with respect to draft amendments to Pillar 3 disclosure guidelines for domestic systemically important banks (D-SIBs) and small- and medium-sized banks (SMSBs) on interest rate risk in the banking book (IRRBB) disclosure expectations. The amendments incorporate the Basel Committee on Banking Supervision disclosure standard on interest rate risk in the banking book and align with draft amendments to Guideline B-12 – Interest Rate Risk Management. The amendments have no impact on capital or liquidity expectations for institutions in scope. For small- and medium-sized banks, disclosure expectations are applied in proportion to the nature, size, and complexity of the deposit-taking institution. |
Comments are due July 20, 2026. Final version of revised guideline is expected to be published in September 2026, with disclosure expectations expected to come into effect for fiscal Q4 2027 reporting periods. |
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May 21, 2026 |
Draft Internal Liquidity Adequacy Assessment Process Guideline (2027) – Letter OSFI has informed banks and trust and loan companies by letter of a consultation with respect to a draft Internal Liquidity Adequacy Assessment Process (ILAAP) Guideline, with feedback intended to inform a final guideline that would take effect on May 1, 2027. The draft Guideline is intended to enhance alignment of liquidity requirements with underlying risks faced by institutions, improve clarity, and promote a more consistent application of liquidity rules. Feedback from a May 2025 discussion paper exploring Pillar 2 liquidity concepts about improving liquidity supervision and what should be taken into account when drafting an ILAAP guideline emphasized the need for a more proportionate approach for smaller, less complex deposit-taking institutions, with sufficient transition time built into the implementation to all for governance, data, and stress-testing enhancements. With respect to a more proportionate approach, OSFI states that while it expects the final guideline to apply to all deposit-taking institutions, it acknowledges that some of the Pillar 2 liquidity risks will not be applicable to all deposit-taking institutions; it has reflected this in the draft ILAAP Guideline. OSFI is proposing a proposing a three-year phased implementation schedule in the draft ILAAP Guideline, applicable to all deposit-taking institutions. |
Comments are due August 19, 2026. OSFI proposes a phased implementation schedule, beginning in May 2027 and building to maturity by 2029 fiscal year-end. |
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May 21, 2026 |
Draft Guideline B-2 Large Exposure Limits (2028) OSFI has informed banks and trust and loan companies by letter of a consultation with respect to draft revisions to Guideline B-2 – Large Exposure Limits. The current version of Guideline B-2 applies to domestic systemically important banks (D‑SIBs); these draft amendments extend the scope of Guideline B-2 to Category 1 and Category 2 small‑ and medium‑sized banks (SMSBs). They would replace the 1994 large exposure guideline currently applicable to these institutions. In addition, under these revisions, Category 3 SMSBs and foreign bank branches will no longer be subject to the large-exposure guideline. Changes to Guideline B-2 will include the following:
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Comments are due August 19, 2026. Final version of revised guideline will come into effect on November 1, 2027 or January 1, 2028 for institutions with a fiscal year ending October 31 or December 31, respectively. |
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Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) |
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May 6, 2026 |
Administrative Monetary Penalties: Changes Following Legislative Amendments FINTRAC has issued a document explaining how FINTRAC will implement a new approach to administrative monetary penalties (AMPs), pursuant to amendments put in place by the Strengthening Canada’s Immigration System and Borders Act, S.C. 2026, c. 4 (Bill C-12). It describes how FINTRAC is updating its AMP policy and developing new guidance to reflect the changes resulting from the legislative amendments. The new guidance will explain how penalties are administered under the new legislative framework and will include guidance on compliance agreements and compliance orders as well as an updated approach to calculating penalties. According to FINTRAC, the new administrative monetary penalties framework will give it the authority to:
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New legislative requirements will apply to violations that occur after March 26, 2026. |
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Payments Canada |
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May 27, 2026 |
CACPA Code STP Formatting Best Practices Payments Canada has released best practices and formatting guidelines for Canadian routing numbers, or CACPA codes, to facilitate straight-through processing (STP). This industry guideline is designed specifically for domestic and international payment originators who are sending wire transfers within or destined for Canada. |
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May 21, 2026 |
National Fraud Strategy: Payments Canada Feedback Department of Finance Canada issued a National Anti-Fraud Strategy Discussion Paper in April 2026, requesting feedback on three initial measures that might be taken to advance the strategy. Payments Canada has submitted its feedback, emphasizing the following:
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Financial Stability Board (FSB) |
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May 6, 2026 |
Report on Vulnerabilities in Private Credit FSB has issued a report that highlights that private credit brings benefits but also vulnerabilities, including complex interlinkages with banks, borrower credit quality concerns, and valuation opacity. It reports that although the growth of private credit may bring benefits, it also brings potential vulnerabilities. Private credit at its current size and scope has not been tested during a severe economic downturn, which could expose leverage and borrower credit quality vulnerabilities. The report argues that authorities should work to close data gaps, harmonise definitions to enhance monitoring, and deepen analysis of financial interconnections and liquidity issues, while sharing supervisory insights. |
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Legislation |
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May 26, 2026, 2026 |
Among its provisions to implement the 2026 Spring Economic Update, the following measures of Bill C-30 affect federally regulated financial institutions:
Division 3 of Part 3 amends the Canadian Payments Act to provide immunity for the Canadian Payment Association and certain individuals from any civil liability, other than in contract, for anything done or omitted to be done in good faith in the administration or discharge of any powers or duties conferred under that act. |
House of Commons Second Reading on May 26, 2026. Referred to Standing Committee on Finance. Division 1 of Part 3 comes into force on the 120th day after the day on which Bill C-30 receives Royal Assent. Division 2 of Part 3 comes into force on proclamation but see coming into force provisions for section 20. Division 3 of Part 3 is in force on Royal Assent. |
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May 20, 2026 |
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, S.C. 2026, c. 7, amended Schedule IV of the Bank Act to clarify how a country or territory acceding to an existing trade agreement is treated under Schedule IV of the Bank Act. Accordingly, the reference to Schedule IV of the Bank Act in the Policy By-law is amended by this By-law to ensure alignment with the amendments to Schedule IV to the Bank Act. |
In force on the day 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, S.C. 2026, c. 7, s. 11, comes into force. |
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May 6, 2026 |
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. |
Royal Assent May 6, 2026 |
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May 6, 2026 |
Bill C-31, Budget 2025 Implementation Act, No. 2 Bill C-31 implements certain measures put forward in the November 4, 2025, Budget. Division 1 of Part 4 amends the Trust and Loan Companies Act, the Bank Act and the Insurance Companies Act to prohibit financial institutions from issuing documents in bearer form and provide for the replacement of documents that are currently in bearer form. Division 2 of Part 4 amends the Trust and Loan Companies Act, the Bank Act and the Insurance Companies Act to provide that no action lies against His Majesty in right of Canada and federal government officials for any acts or omissions made in good faith under those acts. Division 3 of Part 4 amends the Bank Act to require an institution to offer or sell deposit products in a non-discriminatory manner in certain circumstances. Division 6 of Part 4 amends Schedule II to the Access to Information Act to prohibit the disclosure of confidential information obtained under the Retail Payment Activities Act or prepared from information obtained under that act. |
House of Commons First Reading on May 6, 2026. Division 1 of Part 4 in force on Royal Assent. Division 2 of Part 4 in force on Royal Assent. Division 3 of Part 4 in force on proclamation. Division 6 of Part 4 in force on Royal Assent. |
Disclaimer
This Reporter is prepared as a service for our clients. It is not intended to be a complete statement of the law or an opinion on any subject. Although we endeavour to ensure its accuracy, no one should act upon it without a thorough examination of the law after the facts of a specific situation are considered.
