Canada's Office of the Superintendent of Financial Institutions has lowered the Domestic Stability Buffer to 3.0% from 3.5% of total risk-weighted assets and reduced its range to 0 to 3% from 0 to 4%. The change, the first since June 2023, takes effect immediately and is intended to give Canada's six largest banks greater flexibility to deploy capital while preserving resilience. OSFI linked the adjustment to the capital strength of Canada's largest banks. Their average Common Equity Tier 1 ratio stands at 13.5%, well above the new supervisory expectation of 11.0%. OSFI said that cushion amounts to about CAD 74 billion, or capacity to support roughly CAD 673 billion in additional risk-weighted assets. The agency said releasing excess capital should help banks support the Canadian economy's adaptation to shifts in technology, trade and geopolitics, including opportunities in defence and security, critical infrastructure, resources and artificial intelligence.
Office of the Superintendent of Financial Institutions2026-06-19
Canada's Office of the Superintendent of Financial Institutions lowers Domestic Stability Buffer to 3.0% and narrows range to 0 to 3%
Canada's Office of the Superintendent of Financial Institutions cut the Domestic Stability Buffer to 3.0% from 3.5% of risk-weighted assets and narrowed its range to 0 to 3% from 0 to 4%, effective immediately. OSFI said Canada's six largest banks hold average Common Equity Tier 1 ratios of 13.5%, above the new 11.0% supervisory expectation, allowing more capital to be deployed into the economy.