Canada's financial regulator lowers stability buffer for big banks, allowing them to lend more
Canada's financial regulator lowers stability buffer for big banks, allowing them to lend more TORONTO, June 19 (Reuters) - Canada's financial regulator on Friday lowered the capital requirement for the country's biggest banks for the first time in three years, a move that will allow the banks to lend more as the government seeks to boost investment in AI, resources and other areas during trade and geopolitical uncertainties.
The Office of the Superintendent of Financial Institutions (OSFI), which oversees the banks to ensure financial stability, lowered the domestic stability buffer (DSB) to 3% from 3.5%. The regulator had last increased the buffer in June 2023.
The changes to the DSB- applicable to Royal Bank of Canada RY.TO, TD Bank TD.TO, BMO BMO.TO, Bank of Nova Scotia BNS.TO, CIBC CM.TO and National Bank of Canada NA.TO- is effective immediately, OSFI said.
(Reporting by Nivedita Balu in Toronto; Editing by Caroline Stauffer)
(( Nivedita.Balu@thomsonreuters.com ; +1-343-401-6776))
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