Canadian banking regulators have published new guidelines for banks on their obligation to disclose their leverage ratios under the new Basel III capital regime.
The Office of the Superintendent of Financial Institutions (OSFI) has published guidance for banks on the implementation of the leverage ratio disclosure requirements. The draft guideline sets out OSFI’s expectations for the content, format, and frequency of leverage disclosure.
Earlier this year, global banking regulators (the Basel Committee on Banking Supervision) issued final rules on the leverage ratio framework and disclosure requirements under Basel III. That framework introduces “a simple, transparent, non-risk based leverage ratio to act as a credible supplementary measure to the risk-based capital requirements,” OSFI notes. Starting Jan. 1, 2015, the framework also includes requirements for making public disclosure of the ratio along with the publication of the financial statements.
OSFI indicates that it expects Canadian banks that are considered domestic systemically-important banks (DSIBs) to fully implement the leverage disclosure requirements for the first quarter of 2015 reporting. And, it will require non-DSIBs to fully implement the disclosures for yearend 2015 reporting. It also says that it expects that DSIBs will adopt all future disclosure recommendations that are endorsed by international standard setters.