Ontario’s provincial government reiterated its support for a co-operative national securities regulator and a new provincial financial services regulatory authority (FSRA) in its latest economic outlook and fiscal review delivered on Monday, but didn’t have any news on the possible regulation of financial planning.
Finance Minister Charles Sousa formally announced that Ontario’s government will introduce legislation to establish the FSRA to replace the Financial Services Commission of Ontario (FSCO) and the Deposit Insurance Corp. of Ontario (DICO) after previewing that announcement in a speech last week.
In the coming months, Ontario will also appoint the new FSRA’s initial board of directors and produce a detailed implementation plan, Sousa noted. The reform follows recommendations from an expert panel that reviewed the regulatory framework for provincially regulated financial services firms.
The provincial government also reiterated its support for establishing the Co-operative Capital Markets Regulator (CCMR), saying that it plans to introduce the legislation required to establish the CCMR, following work with the other jurisdictions that are participating in the project. “The authority is expected to be operational in 2018,” the province notes in its economic update.
Meanwhile, on the issue of regulating financial planning, which is undergoing a review by an expert panel, the government merely said that the final report and recommendations will be released in early 2017.
The province’s economic update also raised the subject of regulating syndicated mortgages, which was flagged by the expert panel that reviewed FSCO, amid concerns that the market has grown significantly and that these products are increasingly being sold to ordinary retail investors.
“The panel recommended that syndicated mortgage–offering documents should be subject to the same level of regulation that the securities regulator applies to other offering documents used to raise capital in Ontario,” the provincial government noted.
Ontario’s government indicated in its latest economic outlook and fiscal review that it recently established a working group of representatives from the Ontario Securities Commission (OSC), FSCO, and the Ministry of Finance that’s developing recommendations for ensuring adequate investor protection in this segment of the market. “The government will announce further actions by spring 2017,” it says.
Finally, the government also indicated its plans for modernizing the regulation of credit unions, including initial legislative amendments that would provide the authority to set different deposit insurance limits for different deposits; remove differentiated rules for small credit unions; and permit credit unions to enter into loan syndication agreements with credit unions in other provinces. The province is also planning changes to allow credit unions to establish or acquire insurance agents or registered insurance brokers.