Bank Recapitalization (Bail-in) Issuance Regulations

The Bank Recapitalization (Bail-in) Issuance Regulations provide guidelines for domestic systemically important banks to follow when issuing prescribed shares and liabilities. The regulations aim to ensure that these financial instruments are subject to conversion into common shares under the Canada Deposit Insurance Corporation Act in the event of a bank's failure. Specifically, the regulations require banks to include terms in their liability issuances that acknowledge the holder's binding by the Canada Deposit Insurance Corporation Act and the laws of Canada or a province with respect to the operation of that Act. Banks must also disclose this information in prospectuses, information circulars, and other offering documents related to prescribed shares or liabilities. The regulations further prohibit banks from advertising or promoting prescribed liabilities as deposits or variations of that term. These regulations came into effect on September 23, 2018, after being registered for 180 days.