article
Designing and Implementing the Cyber Risk Dashboard
Due to the lack of an effective, integrated approach for cyber risk management, gaps in cyber risk reporting are common.
newsletter
The CFO: A Catalyst for Change in Uncertain Times
Much has been written in recent years about the potential for broadening the role of CFOs at financial services organizations, including credit unions. Of special concern has been the extension of the CFO’s traditional finance and comptroller role to include greater involvement in sophisticated strategic planning and external communication, and to foster better cooperation with risk management.
newsletter
Road to Recovery: A Strategic Planning Blueprint
As the debt forgiveness period winds down, concerns about what happens in the post-debt holiday period begin to emerge. Most financial institutions, including mortgage insurers, offered a three to six month deferral period to retail and non-retail borrowers. According to BBA’s research, an estimated 20% - 40% of the loan book exposure went on payment holiday as a result of the abrupt stop in economic activity.
report
Alternative Rating Development Approaches: Shadow Bond Approach
Where good-bad analysis cannot be used due to lack of default data, the ‘shadow-bond method’ offers a less robust but statistically valid alternative. Here the ability of financial factors to predict default is modelled by measuring their ability to predict external rating agency default rates.
report
Regulatory Approval of Internal Ratings Based Approach
More than ten years after the roll-out of Basel 2, many lending intuitions in Canada are still using the Standardized Approach (SA) for regulatory reporting. As a consequence, reporting institutions are either setting aside disproportionately higher capital for their loan book, are engaged in regulatory arbitrage by issuing residential real estate loans or are involved in "originate-to-distribute" lending. All of these afore-mentioned consequences contribute to higher systemic risk
article
Distribution Analysis for Information Risk (DAIR): A Cyber Quantification Framework
We know that cyber threats continue to evolve and pose increasingly significant risks to organizations. We also know that the impact of cyber-attacks extends beyond direct financial consequences. Cyber incidents can lead to serious service disruptions, reputational damage and share price deterioration, along with potential for fines and litigation. We also know that the impact of cyber-attacks extends beyond direct financial consequences. Cyber incidents can lead to serious service disruptions, reputational damage and share price deterioration, along with potential for fines and litigation.
webinar
BANKINGBOOK WEBINAR SERIES 2 - Episode 1
Digitization of Enterprise Risk Management on October 28, 2020, at 5:00 pm EST
webinar
BANKINGBOOK WEBINAR SERIES 2 - Episode 2
Maximizing Deposit Margin and Growth in Low Rate Environment on November 18, 2020, at 5:00 pm EST
webinar
BANKINGBOOK WEBINAR SERIES 2 - Episode 3
Managing and Forecasting Cyber Risk on December 9, 2020, at 5:00 pm EST
news
Building Resilience: OSFI Sets Domestic Stability Buffer Level At 2.25%
Today the Office of the Superintendent of Financial Institutions (OSFI) set the Domestic Stability Buffer (DSB) at 2.25% of total risk-weighted assets, effective April 30, 2020. This reflects OSFI’s view that key vulnerabilities to Canada’s Domestic Systemically Important Banks (D-SIBs) remain elevated, and in some cases show signs of increasing. The key vulnerabilities include Canadian household indebtedness, asset imbalances, and institutional indebtedness. In addition, global vulnerabilities related to ongoing trade tensions and rising leverage are growing, which could increase the chance of a spillover of external risks into the Canadian financial system. Against a backdrop of accommodating low-interest rates and stable economic conditions, it is prudent to build additional resilience against potential shocks to the financial system. An effective capital regime ensures that banks are holding adequate capital to protect against risks to the financial system, while also encouraging them to use their buffers during times of stress to avoid asset-sales or drastic reductions in lending. This announcement is consistent with recent statements from the Financial Stability Board, which caution that “given rising global vulnerabilities, authorities should continue to assess whether existing buffers are adequate to support resilience, taking into account their domestic conditions and cyclical position.” OSFI remains committed to increasing the understanding of the purpose of the DSB to support the banks’ use of this capital buffer in times of stress.
news
The FSRA Announces Membership Of New Stakeholder Advisory Committees
The FSRA is very pleased to announce the membership for six new Stakeholder Advisory Committees (SACs) that will provide input and advice to FSRA’s Board of Directors and help to shape the future of financial regulation in Ontario. There was a strong response to the call for applications, with 265 submissions received from a broad cross-section of applicants from each sector. Many thanks to all our applicants for participating in this important initiative; your input and perspectives will continue to be highly valued as we continue our work together. The new SACs are another example of how the FSRA is committed to openness, transparency, and collaboration with stakeholders, and considering a broad range of perspectives when making strategic decisions.
news
Google Is Preparing To Launch A Chequing Account Backed By Citigroup And A Stanford University Credit Union
Google’s new chequing account service could help banks in their battle for consumer deposits. The technology giant said last week that it is exploring how it can partner with banks to offer chequing accounts through its Google Pay app. Citigroup Inc. and a California credit union signed on as initial partners for the effort -- a move that could help them acquire extra customers as the industry contends with slowing growth in deposits. “It’s a war for deposits,” Betsy Graseck, an analyst at Morgan Stanley, said in a note to clients Friday. “An opportunity to deliver value to corporate customers and acquire incremental chequing accounts as well as a good business decision.” Deposit growth at the biggest U.S. banks slowed to 2.2% last year, the lowest level since 2010, according to data compiled by Bloomberg Intelligence. Consumers have increasingly flocked to newer, digital-only banks that come with flashy mobile apps and often offer higher interest rates for their savings. Citigroup has been making a push for consumer deposits after it debuted its national digital bank and restructured its U.S. consumer operations last year, bringing Anand Selva from the firm’s Asia business to lead the new unit. Average deposits in the firm’s U.S. retail banking arm have climbed 2.9% this year to $186 billion. With the Google partnership, Selva is leaning on a playbook that he learned in Asia, where Citigroup has forged partnerships with consumer companies including Paytm, India’s largest payments platform, and Grab, the ride-hailing app in Southeast Asia.