Canada moves into bail-in territory
Good to see Canada responding to the Group of 20 (G-20) initiative made in the wake of the recent global financial crisis. Yesterday Finance Minister Joe Oliver launched a public consultation on bail-in for Canada’s domestic systemically important banks.
Canada joins the jurisdictions that have incorporated bail powers into their resolution regimes, e.g. Denmark, the United Kingdom, Switzerland and the United States – and those that are working on bailin, e.g. Europe.
For bail-in to make it work, it shall be statutory, not contractual as currently is the case in Canada. Imagine the work to sort out the contracts underlying many bailinable instruments in a weekend’s time.
All comments should be received by September 12 , 2014.