Bank of Montreal has cancelled its 40-year mortgage program after the federal government said last week that it plans to stop insuring such home loans in October.

BMO said in a statement Friday that it will cap the amortization periods on their mortgages at 35 years, the maximum the government is willing to underwrite starting October 15.

BMO also said that it will no longer issue mortgages without a 5% down payment, which will become another requirement for receiving federal insurance following Finance Minister Jim Flaherty’s announcement on Wednesday.

The Finance Department said it moved to rein in the housing market to avoid excesses that led to the U.S. housing bubble.

The bank said it will continue to honour 40-year mortgages that have been approved.

“BMO fully supports the action Minister Flaherty has taken to protect and strengthen Canada’s housing market,” stated Frank Techar, president and CEO, personal and commercial banking Canada, BMO Financial Group.