{"id":19106,"date":"2016-03-23T14:18:29","date_gmt":"2016-03-23T19:18:29","guid":{"rendered":"http:\/\/olduvai.ca\/?p=19106"},"modified":"2016-03-23T14:18:29","modified_gmt":"2016-03-23T19:18:29","slug":"new-law-proposed-to-shift-bank-failure-risk-from-taxpayers","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=19106","title":{"rendered":"New law proposed to shift bank failure risk from taxpayers"},"content":{"rendered":"
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New law proposed to shift bank failure risk from taxpayers<\/a><\/h3>\n<\/div>\n

Ottawa proposes ‘bail-in’ regime to force creditors to prop up failing banks<\/strong><\/p>\n

\"The<\/p>\n<\/div>\n<\/div>\n

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The Liberal government says it will create legislation that shifts some of the risk in a bank failure to creditors. (Canadian Press)<\/p>\n<\/div>\n<\/div>\n

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Canada will introduce legislation to implement a “bail-in” regime for systemically important banks that would shift some of the responsibility for propping up failing institutions to creditors.<\/div>\n<\/div>\n<\/div>\n
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The proposed plan outlined in the federal budget released on Tuesday would allow authorities to convert eligible long-term debt of a failing lender into common shares in order to recapitalize the bank, allowing it to remain operating.<\/p>\n

The plan is in line with international efforts to address the potential risks to the financial system from institutions that are deemed too big to fail, the budget document said.<\/p>\n

The issue was at the heart of the 2008 global credit crisis, with various governments having to bail out systemically important institutions.<\/p>\n

Canada, which escaped the crisis relatively unscathed, did not have to rescue any of its banks though\u00a0they got billions in support during the crisis<\/a>\u00a0and the recession that followed. The government said it will introduce framework legislation for the plan, along with enhancements to Canada’s bank resolution toolkit.<\/p>\n

When the Harper government floated the idea of a bail-in regime in 2014,\u00a0Moody’s cut its ratings on Canadian banks<\/a>.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

New law proposed to shift bank failure risk from taxpayers Ottawa proposes ‘bail-in’ regime to force creditors to prop up failing banks The Liberal government says it will create legislation that shifts some of the risk in a bank failure to creditors. (Canadian Press) Canada will introduce legislation to implement a “bail-in” regime for systemically […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[2490,8212,63,103,3048,3544,3000,195,541,13081,802],"class_list":["post-19106","post","type-post","status-publish","format-standard","hentry","category-economics","tag-2008-financial-crisis","tag-bail-in-legislation","tag-banks","tag-canada","tag-canadian-banks","tag-cbc","tag-cbc-news","tag-debt","tag-moodys","tag-thomson-reuters","tag-too-big-to-fail"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/19106","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=19106"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/19106\/revisions"}],"predecessor-version":[{"id":19107,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/19106\/revisions\/19107"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=19106"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=19106"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=19106"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}