Bloomberg News

Canada Regulator Urges Banks to Be ‘Diligent’ on Mortgages

November 02, 2011

Nov. 2 (Bloomberg) -- Canada’s Office of the Superintendent of Financial Institutions said that banks should maintain sound, prudent mortgage underwriting practices.

Canada’s main banking regulator issued a letter today to federally-regulated financial institutions after the Financial Stability Board published international underwriting principles.

“Given the current uncertainty and volatility in global capital markets, historically low interest rates, higher Canadian borrower debt-to-income levels, and relatively strong housing price appreciation, OSFI expects (lenders) to be extra diligent in maintaining sound and prudent mortgage underwriting practices,” Superintendent Julie Dickson wrote in the letter.

--Editor: David Scanlan

To contact the reporter on this story: Sean B. Pasternak in Toronto at spasternak@bloomberg.net.

To contact the editors responsible for this story: David Scanlan at dscanlan@bloomberg.net; David Scheer at dscheer@bloomberg.net.


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