New metric follows proposed changes to global bank rating methodology
Review notes the resilience of the banking system overall has improved
Ultimate impact will be determined by the length and severity of price declines, and spillovers to the broader economy
The draft rules are generally viewed as a positive for creditors
Even with reforms, performance, vesting and deferral periods are still too short to cover credit cycles and potential tail risks
High consumer debt levels and an overheated housing market pose risks
Domestic systemically important banks (D-SIBs) must fully implement the new leverage ratio disclosures starting with their reporting for the first quarter of 2015
Move reflects lack of strong growth in some foreign operations
Canada’s banks preparing for slower growth: analyst
Firms are expected to implement the new guidance by May 1