Office of the Superintendent of Financial Institutions

And the other piece is that we are a, as a financial institution, we're regulated.

So, uh, companies that are set up federally are regulated by OSFI, which is the federal regulator.

We've got a handful of very large insurers regul- uh, incorporated in Quebec, so they're regulated by the AMF.

But, but to summarize for a listener what that means, it means we're supervised.

Yeah.

But even while we're doing all of the, you know, the breaking and like, I mean, I imagine your federal government can't really influence like a, you know, Peter Routledge on, at OSFI to like, you know, if he thinks that this is a safe thing for financial institutions, it's what he's going to do.

So they're like, all right, well, we got to fix this by adding some demand.

Right.

You know, when

you think about the government, like, do you just like assume that they all like work in the same office together? Like it's like the big building.

And like, cause I'm like, I'm just thinking about, yeah, I'm thinking about like, you know, like Peter Routledge at OSFI is like the, like, he's like Bob from accounting, like, you know, behind the door or whatever.

And they're like, oh, like Peter over there, just, just shut off borrowing power.

This makes close monitoring of U.S. banks almost impossible.

The Government of Canada has one bank regulator, the Office of the Superintendent of Financial Institutions.

It sets the rules and closely monitors the banks.

The Canadian banks abide by strict domestic stability buffer, which requires banks to hold extra reserve cash during economic expansions.

And so we will likely not see a fundamental market repricing like we saw in COVID, but we may well see more lender declines in that instance and or some of the borrower's terms be adjusted to make sure they declare markets such as Tenor.

The flip side of that is in June, OSFI, which is the regulator here in Canada, reduced the domestic stability buffer from 3.5% to 3% for the large Canadian lenders.

And in essence, what that means is those lenders are required to hold a lower level of capital on their balance sheets.

So theoretically, they will be able to deploy more capital to support their clients in the coming months and years.

And So I think, like you were saying, I can understand it can seem like there are more hurdles and more barriers and more things for you to set up and figure out.

But I actually think it's really great that we have the RPA now because a lot of what the Bank of Canada was doing or maybe FinTrack was enforcing, was a lot of these sponsor banks or these networks were having almost to play the role of regulator themselves to make sure, okay, if no one's asking you this, OSFI is going to expect me to at least ask you this.

So I think it helps to have these regulatory frameworks that help show, and I know it's still early days, especially for the RPA, but to show to sponsor banks or partners that hey you don't have to take my word for it or even maybe if i find an external auditor to tell you that i have everything i should have uh you can take the bank of canada's word for it like they've examined me on these few things they said that i have a clean bill of health so you should feel confident and then your regulators will also have a knock-on feel of confidence So I think it's going to be a real launchpad to helping a lot of fintechs.

You know, it is a bit more work on day one.