The Bank of Canada and three of the country’s main securities regulators have agreed to cooperate in their oversight of financial market infrastructure, such as clearing and payment systems, in order to help manage systemic risk.
The central bank announced that it has entered a memorandum of understanding (MOU) with the Autorité des marchés financiers (AMF), the British Columba Securities Commission (BCSC), the Ontario Securities Commission (OSC) designed to facilitate cooperation between them in overseeing organizations that form critical components of financial market infrastructure (FMIs).
The regulators indicate that their cooperation aims to promote “the safety and efficiency” of these firms, while also limiting and managing the systemic risk associated with the operations that comprise the plumbing of the financial system.
The MOU establishes a framework for information sharing, consultation and coordination among the authorities when it comes to their responsibilities to oversee the CDSX system operated by the Canadian Depository for Securities (CDS) and the Canadian Derivatives Clearing Service operated by the Canadian Derivatives Clearing Corporation (CDCC). It provides a mechanism for mutual cooperation and assistance, and formalizes current cooperative arrangements among them, the MOU says.