In a speech, Canada's Office of the Superintendent of Financial Institutions (OSFI) set out how it is reorienting supervision around integrity and security threats, pointing to geopolitical instability, fast-moving technologies and third-party reliance as drivers of cyber-attacks, state-linked interference and other integrity risks. The Superintendent also indicated OSFI will examine whether risk-weighting adjustments could be made to help enable defence-related lending without weakening financial resilience. OSFI has established an Integrity and Security Risk Division and a National Security Sector, and has adjusted its supervisory work to address integrity and security deficiencies more explicitly through thematic reviews, targeted examinations and collaboration with Canada’s security and intelligence agencies. A classified national security forum with the Canadian Security Intelligence Service and the Communications Security Establishment began in 2024 and is expected to continue. The remarks also highlighted expectations for stronger governance, compliance and third-party oversight, and framed artificial intelligence as both a risk amplifier and a potential control tool, with existing cyber, third-party and model risk frameworks positioned as key mitigants. On system capacity, Canada’s systemically important banks reported average Common Equity Tier 1 ratios of 13.7% in the most recent quarter, and OSFI estimated they could extend nearly CAD 1 trillion in additional credit while remaining above current capital minimums. No conclusions were reached on defence-related risk weight changes, and any potential adjustments would be subject to a public consultation through CAR 2027.
Office of the Superintendent of Financial Institutions 2025-09-25
Canada's Office of the Superintendent of Financial Institutions elevates integrity and security supervision and signals a possible defence-lending risk weight review
Canada's Office of the Superintendent of Financial Institutions (OSFI) is reorienting supervision to address integrity and security threats from geopolitical instability and technological advancements. OSFI has created an Integrity and Security Risk Division and a National Security Sector, enhancing oversight through thematic reviews and collaboration with security agencies. The Superintendent noted artificial intelligence's dual role as a risk and control tool, with existing frameworks as key mitigants.