Canada: Financial Sector Assessment Program-Technical Note-Oversight of Financial Market Infrastructures and Fintech Development
IMF Staff Country Reports, January 24, 2020
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- Canada: Financial Sector Assessment Program-Technical Note-Oversight of Financial Market Infrastructures and Fintech Development
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Bibliographic details
- Published: January 24, 2020
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781513527222.002
Assessment overview
- Reviews assessment of financial market infrastructures (FMIs) and authorities’ responsibilities in Canada.
- Finds FMIs have operated normally under a well-established legal and oversight framework that is distinct for Canada.
- The Bank of Canada (BOC) has issued a Guideline that defines the criteria for identifying FMIs.
- Recognition of a clearing agency is required under provincial securities legislation where terms and conditions and the clearing rule would apply.
Legal and oversight framework
- Oversight is split between the Bank of Canada and provincial securities regulators.
- The current oversight approach can benefit from stronger enforcement powers available to the BOC.
- Provincial securities regulators are encouraged to train FMI oversight staff in advanced quantitative skills to support risk assessment.
Operational risks, liquidity, and cyber resiliency
- Further enhancement in managing liquidity and operational risks will help ensure the robust functioning of FMIs.
- Improvements in cyber resiliency continue in line with international guidance, including industry-wide exercises carried out by FMI operators and participants.
- Compliance to endpoint security needs to be tightened by self-attestations and audits of FMI participants.
- The categorization and reporting of operational incident severity levels could be further coordinated.
Key recommendations and policy implications
- Strengthen enforcement powers available to the Bank of Canada.
- Provide advanced quantitative training for FMI oversight staff at provincial securities regulators to improve risk assessment.
- Enhance liquidity risk management and operational risk controls across FMIs.
- Tighten endpoint security compliance through self-attestations and audits of FMI participants.
- Coordinate categorization and reporting of operational incident severity levels across authorities and FMI operators.
Publication and metadata
- Publication date: January 24, 2020
- Pages: 37
- Volume: 2020
- Issue: 022
- Series: Country Report No. 2020/022
- DOI: https://doi.org/10.5089/9781513527222.002
- Stock No: 1CANEA2020007
- ISBN: 9781513527222
- ISSN: 1934-7685
International Monetary Fund. Monetary and Capital Markets Department "Canada: Financial Sector Assessment Program-Technical Note-Oversight of Financial Market Infrastructures and Fintech Development", IMF Staff Country Reports 2020, 022 (2020).
Content in this bundle
- Executive Summary