TORONTO — Canada's banking regulator has released draft guidelines on how it expects to oversee the integrity and security of financial institutions, including foreign interference risk.
The guidelines released Friday by the Office of the Superintendent of Financial Institutions come as a result of the federal government expanding the regulator's mandate in June to cover those areas, and are part of a widening of its oversight beyond the direct financial health of institutions.
“Public confidence depends not just on knowing that financial institutions are and will remain financially sound but also in knowing that they conduct their business with integrity," said OSFI assistant superintendent Tolga Yalkin in a media briefing.
“We're now required to advance the management of these risks, irrespective of their link to overall financial health of the institutions we regulate."
The guidelines for integrity include aspects like ensuring the "good character" of board members and senior leadership, while security includes areas such as managing physical access to buildings, servers and other key infrastructure.
The regulator also released updated guidelines on Friday for operational resilience, including new expectations in areas like crisis management and data risk management.
There is a six-week window to provide feedback on the proposed guidelines.
Increased oversight into areas that aren't directly related to finances is part of an ongoing evolution of the regulator, said Yalkin, noting that it's already expanding oversight into areas like climate change and digitization-related threats like cryptocurrencies and artificial intelligence.
He says the regulator is also expanding its expectations on compliance with rules so that financial institutions comply not just with the letter of the laws, but with their spirit.
This report by The Canadian Press was first published Oct. 13, 2023.
Ian Bickis, The Canadian Press
