The Office of the Superintendent of Financial Institutions has proposed updates to its Total Loss Absorbing Capacity Guideline for Canada’s domestic systemically important banks. The changes would clarify requirements for external legal opinions covering Other TLAC Instruments issued under foreign law, helping the regulator assess whether those instruments can absorb losses and support an orderly resolution. Banks would need to obtain updated external legal opinions at least every two years. The revised guideline would also prescribe the minimum points of law that opinions must address and clarify expectations when additional debt is issued under an existing indenture. Other TLAC Instruments include prescribed shares and liabilities that are subject to conversion into common shares and meet the guideline’s eligibility criteria. The final changes are scheduled to take effect May 1, 2027.
2026-09-10Office of the Superintendent of Financial Institutions
Canada's Office of the Superintendent of Financial Institutions launches consultation on legal opinion requirements for foreign law TLAC instruments
The Office of the Superintendent of Financial Institutions has proposed updated legal opinion requirements for foreign law Total Loss Absorbing Capacity instruments issued by Canada’s domestic systemically important banks. External opinions would need to be renewed at least every two years and address specified legal issues, with final changes scheduled to take effect May 1, 2027.