CDIC’s Funding Framework

CDIC’s funding framework includes a deposit protection fund (ex ante fund) and deposit insurance premiums paid by member institutions that are determined by our Differential Premiums System (DPS). The goal of this strong funding framework is two-fold:

• To support the timely resolution of a member institution in the rare event it should fail
• To provide Canadians with confidence that CDIC will protect their deposits

Strategic Review and Consultation

CDIC’s funding framework was last reviewed in 2014. Since then, CDIC’s mandate and the risk and operating environment for member institutions have changed significantly.

In July 2022, CDIC announced revisions to our deposit protection fund (ex ante fund) target level and launched a 90-day public consultation on proposed changes to our DPS. CDIC asked member institutions for feedback on a number of proposed changes to the risk-based ratings system we use to differentiate them and achieve key policy objectives under the deposit insurance framework. For more information, please consult this summary of feedback from member institutions.

In July 2023, CDIC finalized the changes to the DPS to reflect the input we received from member institutions. The changes, along with associated timelines for implementation, are outlined in CDIC Differential Premiums System Review – Conclusions.

The key changes are:  

• Raise the number of premium categories from four to five
• Increase the frequency of differential premium assessments (process of classifying member institutions into risk categories) from annual to semi-annual
• Enhance the DPS scorecard, which measures financial and regulatory criteria, to capture a broader set of risks posed by member institutions to CDIC

Going forward, CDIC will continue to work with our member institutions to anticipate and respond to developments in the financial sector and ensure the deposit insurance protection and resolution frameworks remain fit for purpose. 

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