For its part, Canada’s bank regulator, the Office of the Superintendent of Financial Institutions, released new guidance on mortgage underwriting and mortgage insurance that implemented enhanced global standards. These measures were successful in slowing household credit growth and they complemented the Bank of Canada’s accommodative monetary policy by better targeting the stimulus to the most creditworthy households.
To further enhance our contribution to macroprudential oversight in Canada, we have two aspirations: 1. To develop a framework for system-wide macro-level stress tests that integrates different sectors of the financial system – banking, insurance and investment funds – as well as financial markets and financial infrastructures. 2. To improve our models to better understand the interactions between monetary and macroprudential policy.