Canada’s Financial Institutions ‘Stable and Resilient’ in Face of SVB Collapse, Says Freeland

By Peter Wilson
Peter Wilson
Peter Wilson
Peter Wilson is a reporter based in Ontario, Canada.
March 15, 2023Updated: March 15, 2023

In the wake of the collapse of California-based Silicon Valley Bank (SVB), Finance Minister Chrystia Freeland says Canada’s financial institutions are “stable and resilient.”

Freeland made the comments in an official statement four days after U.S. regulators closed SVB following a bank run, during which depositors concerned about the bank’s solvency withdrew a total of billions of dollars in a short period of time.

Freeland held a virtual meeting on March 14 with provincial and territorial finance ministers to discuss Canadian implications of SVB’s failure. Also attending the meeting were Canada’s Superintendent of Financial Institutions Peter Routledge and the Bank of Canada’s Senior Deputy Governor Carolyn Rogers.

Freeland says the group discussed the current state of Canada’s financial system and “ongoing developments” related to SVB’s collapse.

She adds that the meeting follows a number of previous ones she held between March 10 and March 14 with other heads of national and regional Canadian financial institutions on the same subject.

“The federal government can assure Canadians our financial institutions are stable and resilient,” she said in the statement.

SVB’s Canadian-branch assets were recently seized as a temporary measure by the Office of the Superintendent of Financial Institutions (OSFI), with Routledge voicing intentions to make the seizure permanent.

Routledge also said in a statement on March 12 that he is requesting Attorney General David Lametti apply for a Winding-Up Order for SVB in Canada.

Changing Risks

The superintendent also sought to assure Canadians that his office’s seizure of SVB’s Canadian assets is a measure taken solely as a “result of circumstances particular to Silicon Valley Bank in the United States.”

However, Routledge’s office is also taking steps to begin conducting daily liquidity check-ins with Canadian banks, according to a Globe and Mail report citing anonymous sources, with the goal of the regular checks being to more closely monitor banks’ financial health in a time of uncertainty.

OSFI neither directly addressed nor confirmed the Globe report in an emailed statement to The Epoch Times, but said it is “always monitoring the liquidity of the institutions it regulates.”

“As risks change, so do the frequency and intensity of these efforts. Such adjustments reflect a prudent approach to performance of its supervisory function,” OSFI wrote on March 14.

The office added that it is in regular contact with contact the financial institutions it supervises and that it is also bound by both legislation and regulation to keep all information it gathers confidential.

The Canadian Press contributed to this report.