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Boosting Productivity: Bank of Canada’s Rogers Advocates for Competition in the Financial Sector

Bank of Canada’s Carolyn Rogers: Competition in Canadian Financial Sector Key to Boosting Productivity

Toronto, October 9, 2025 – Carolyn Rogers, Senior Deputy Governor of the Bank of Canada, said competition in Canada’s financial firms can boost productivity. She spoke at the Canadian Club in Toronto. In her speech, Rogers linked ideas closely. Each word connects directly to the next, so the message stays tight and clear.

Productivity Slump Poses Urgent Challenge

Canada’s productivity has stalled. Rogers calls this an emergency. New data shows a 1% drop in productivity in the second quarter of 2025. This drop is the largest in three years. It comes as trade tensions with the United States rise. Rogers links the drop to the need for reforms.

She explained, “Higher productivity won’t make Canada immune to U.S. trade policy, but it would help buffer the effects of tariffs.” Rogers adds, “This is the clearest path to boosting real wages, and it helps make life more affordable.”

Competition as a Driver of Innovation and Efficiency

Rogers says competition forces firms to work fast and smart. It makes them invest in new ideas and improve services. She uses a hockey metaphor: “You always skate a little harder in the game than you do in practice. And when the game starts, the tougher the opponent, the harder you skate.”

Today, six large banks hold about 93% of all banking assets. This strong hold brings stability. Still, strong ties can slow productivity, limit innovation, and reduce consumer choices. Rogers lets us know, “Many argue that this level of concentration has clear negative impacts.”

Emerging Reforms Aim to Enhance Contestability

Looking ahead, Rogers sees hope in new reforms. Regulators and technologists want to open up the financial field. One plan is open banking. Open banking gives consumers more control over their data. This change connects banks and buyers more closely and fairly.

Another plan is the Real-Time Rail project. This project will update payment systems so firms can send money instantly. Rogers points to a study that sees more than $3 billion in efficiency gains in five years. She builds the idea on a clear link between instant payments and more economic strength. “The experiences of countries with instant payment systems show that these systems have real benefits,” Rogers said.

Balancing Competition with Stability and Inclusion

Rogers also warns that more contest does not mean no rules. Too much competition risks underinvestment and financial harm. It may also expose vulnerable groups to risky practices. Rogers stresses, “We need to ensure that while we encourage contestability in finance, transport, telecoms, and energy, we do not sacrifice stability or equal access.”

Global Regulatory Context

Rogers notes that other nations also shape their rules. The United States is cutting back on financial sector rules. In the United Kingdom, Chancellor Rachel Reeves said regulation can hold businesses back. These signals point to a worldwide trend. Each idea is linked clearly to the next, with short connections that show how change can build fresh strength.

Conclusion: Embracing Competition for Economic Growth

In her closing words, Rogers told policymakers and leaders to “lean into” competition. This means taking steps that connect competition directly with stronger productivity, better wages, and a solid economy. She shows that even with tradeoffs, a clear and close link between ideas leads to innovation and growth.

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Navigating the Stablecoin Storm: Why Canada Must Act Now to Protect Its Financial Future

John Ruffolo Warns Canada: The Stablecoin Storm Is Coming and We Can’t Afford to Snooze

By John Ruffolo, Special to Financial Post
Published October 8, 2025

Canada once relied on steel, oil, and lumber. Today, digital rails carry data, ideas, and money. These rails now traverse invisible networks. American firms build most of them. Canada must act soon; else its economy will depend on U.S.-built rails and rules.

The U.S. Leads the Stablecoin Surge

On July 18, the United States passed the Genius Act. This law backs stablecoins with the U.S. dollar. These coins tie one-to-one with U.S. Treasury securities. They now enter mainstream finance. U.S. stablecoins own 99 percent of the market.

Every stablecoin use helps finance U.S. government debt. Every payment feeds U.S. banks. Every transaction moves Canadian data across the border.

Why Canada Must Pay Attention

Stablecoins now process more transactions than Visa and Mastercard. Their use brings several risks for Canadians:

  • Capital Flight: A shift of only 5 percent of Canadian bank deposits—around $135 billion—into U.S. stablecoins may drop domestic lending by about $675 billion. This loss will hit essential loans for homes, small businesses, and provincial infrastructure.
  • Rising Borrowing Costs: Fewer deposits mean lower demand for Government of Canada bonds. Ottawa might then need to offer higher interest rates.
  • Monetary Policy Constraints: More U.S. digital dollars in Canadian hands can weaken the Bank of Canada’s control over money supply and interest rates.
  • Sovereignty Risks: Relying on U.S.-issued stablecoins lets American regulators freeze Canadian company funds held in digital wallets. This move can harm Canada’s financial independence.

Outdated Canadian Regulation Hampers Progress

Canadian regulators treat fiat-backed stablecoins as securities. This view is like judging a Tesla as if it were a horse-drawn carriage. Using this lens pushes real stablecoin issuers to leave Canada. Canadians then depend on foreign—mainly American—stablecoin products.
In contrast, economies in Europe, Singapore, the U.K., South Korea, and the U.S. treat stablecoins as payment tools. This treatment fits their true role and sparks innovation.

A Three-Point Plan for Canadian Prosperity

Canada must move quickly with these steps:

  1. Regulatory Clarity: Change the law to view fiat-backed stablecoins as payment tools rather than securities. Set rules for one-to-one backing with Canadian dollars and Government of Canada bonds. Use clear controls like bankruptcy-remote custody, daily reserve checks, independent audits, and allow OSFI-regulated banks to issue tokenized deposits and Canadian stablecoins. This move keeps Canadian yield and valuable financial data at home.
  2. Financial Sovereignty: Keep reserves, servers, and managing systems only in Canada. Let OSFI-regulated Canadian banks hold these stablecoin assets. Handle disputes under Canadian law. This rule cuts off the reach of foreign regulators.
  3. Adoption and Interoperability: Build digital payment rails that work with current banking apps and systems like the Real-Time Rail. Keep fees low to attract merchants and consumers. The federal government should lead by example. It can accept Canadian stablecoins for tax payments, rebates, and fees. This step will grow public trust.

Looking Ahead: Building a Secure Payment Future

This call is not about chasing trends or fueling speculation. It is a call to build a Canadian payment rail that is as secure and clear as cash. The rail must be rooted in trust, transparency, and Canadian law. These steps are vital. They help Canada compete in a digital world and stop foreign powers from taking control.

John Ruffolo, founder of tech-focused Maverix Private Equity in Toronto, warns that Canada must face the “stablecoin storm” at its doorstep. Its leaders must craft a strong plan before it is too late.

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Score Media Executive Settles Insider Trading Case, Facing Nearly $600,000 in Penalties and Profits from Tipping Scheme

Couple Settles Insider Trading and Tipping Case in Score Media Acquisition

By Barbara Shecter | Financial Post | September 26, 2025

A former executive at Score Media & Gaming Inc. reached a settlement with the Ontario Securities Commission. The commission charged him with insider trading and tipping. The charges relate to the US$2 billion acquisition by Penn National Gaming Inc.

Insider Trading Allegations and Settlement Details

Huy Le Huynh worked as a Vice President of Finance at Score Media. He admitted that he used secret information when he traded. He bought call options with a third party just before the public learned of the takeover. The purchase cost around US$7,000 and made him profits of over US$311,000. Each word here connects closely to the next to keep ideas tight and clear.

Use of Intermediaries and Trading Arrangement

Huynh learned of the acquisition plans before they were public. He told his wife, Thi Anh Nguyet (Nancy) Pham, who was on leave from Bell Canada. Both knew that buying or selling Score Media securities was banned at that time. Huynh then asked his wife’s long-time friend, Jessica Tam, for help. He gave Tam US$10,000 to deposit in her Tax-Free Savings Account. Huynh told her, in person and on the phone, to buy Score Media call options. The plan was simple: split the profit so that 80 percent went to Huynh and Pham, and 20 percent to Tam.

In late July 2021, Tam bought 184 options for US$5,152. She then bought another 120 options for US$1,800. After the takeover was announced, Tam paid Huynh and Pham about US$270,000 in cash. The trio used coded language—terms like “toys” referred to sums of money—over WhatsApp to share the plan details.

Efforts to Conceal Involvement

After trading, Huynh told Tam to delete his contact details from her phone. He also gave her a lawyer’s contact in case anyone questioned the trades. Next, he asked Tam to use some of the remaining money to invest in other securities. Here, every instruction connects directly with its purpose, ensuring the steps stay clear.

Pham admitted that she knew about the acquisition before it was announced. She also said she was aware of the plan that Huynh and Tam made. However, she did not know all of the finer details of the scheme.

Cooperation and Penalties

The couple had no past record of securities violations. They cooperated fully with the OSC investigation. This cooperation helped reduce the penalties. In the end, Huynh and Pham paid nearly US$600,000 in penalties and disgorged profits. Huynh accepted his role in the insider trading, and Pham admitted that her actions hurt the public interest.

Broader Implications

This case shows that Canadian regulators remain alert to insider trading. The OSC works hard to keep markets fair and to protect confidential details. They continue to monitor trades and enforce penalties for misusing private information.

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Turbulent Waters Ahead: How U.S.-Canada Tensions Threaten Canadian Banks’ Capital Stability

Former OSFI Deputy Warns Rising U.S. Tensions Heighten Risks to Canadian Bank Capital

September 25, 2025 – Toronto

A former top banking regulator from Canada has warned the nation’s largest banks. He sees rising tensions with the United States as a risk to their overseas assets and capital. Mark Zelmer, who served as deputy superintendent at the Office of the Superintendent of Financial Institutions (OSFI), points out that Canadian banks are more exposed because they work heavily across borders, mainly in the U.S.

On Thursday, the C.D. Howe Institute published a paper by Zelmer. He states that the world is changing. Foreign authorities might soon block assets held by Canadian financial firms when economies are under stress. Such actions could block banks’ access to vital capital. This in turn may lead to serious challenges in liquidity and stability.

Potential Asset Ring-Fencing Amid Rising Tensions

Zelmer recalls the case of Maple Bank in Canada. In 2016, a German bank saw its Canadian assets blocked after it ran into trouble. This past event shows that regulators can stop cross-border capital flows during crises. He warns that the United States or other nations may take similar or even stricter measures. This is especially true for Canadian banks that have large deposits and operations overseas.

Zelmer writes, "The risk of such behavior is more acute today. International cooperation is harder, especially with the United States."

Canada’s "Big Six" banks—Royal Bank of Canada, Toronto-Dominion Bank, Bank of Montreal, Bank of Nova Scotia, Canadian Imperial Bank of Commerce, and National Bank of Canada—have strong ties in the U.S. For banks like BMO and TD, their U.S. operations sometimes match the size of their Canadian business in both assets and revenue. This closeness may allow foreign regulators to restrict capital in a crisis. This would make bank runs and financial shocks harder to manage.

Recommendations to Mitigate Risk

Zelmer advises banks and insurers in Canada to keep more surplus capital and liquidity at home. While this may cost more or pay lower tax benefits than investing offshore, it lowers the control that foreign regulators have during hard times.

He also asks for clearer public disclosure and more regulatory openness. Banks should share how their Canadian and overseas parts work together. Knowing this will help policymakers and market players see the risks of asset blocks by foreign authorities.

Zelmer explains, "If these investments sit in foreign systems or custody accounts, there is a risk they might be blocked or frozen." He warns that Canada’s biggest banks have large investments in foreign securities that also appear on their home balance sheets.

He stresses that even strong banks can suffer from bank runs. He mentions Home Capital Group, which faced liquidity issues in 2017. Zelmer calls on OSFI and other policymakers to watch bank practices closely. They must manage liquidity risk while thinking about the threat of foreign asset restrictions.

Ongoing Engagement with Canadian Banks

Zelmer notes that OSFI is in active talks with major banks across Canada. They discuss steps to face these new challenges. While details have not yet been finalized, regulators clearly see the risks that come from cross-border capital exposure. This understanding is vital given today’s uncertain global politics.

This report offers the views of an expert former regulator. It points out key vulnerabilities in Canada’s banking system as international relations worsen. The report calls for careful capital management and strong regulation to protect financial stability.

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RBC’s Bold AI Gamble: Can Multibillion-Dollar Investments Transform Canada’s Banking Future?

RBC Bets Billions on AI: Will It Pay Off?

By Yvonne Lau | Published September 18, 2025

Canada’s largest company, the Royal Bank of Canada (RBC), bets billions on artificial intelligence (AI). The bank uses this bet to change its work and spark new growth. AI spreads through many fields. The financial services sector takes it in early. Yet, people now look for clear results. RBC must show that its large spending produces gains.

RBC’s Early AI Research

RBC began its AI work over ten years ago. Foteini Agrafioti started the project. She led Borealis AI Inc., the bank’s own research lab, from the start. Her love of machine learning grew during her PhD at the University of Toronto. In 2016, she launched Borealis AI. The bank let her team experiment with machine learning long before ChatGPT and similar tools appeared. She recalled, “Back then, AI was new, and we had room to learn without immediate need. The bank made a bold, early choice.”

Today, Borealis AI has about 950 data scientists and engineers. They study large sets of RBC’s financial data. Their goal is clear. They build new AI products to help the bank and improve customer service.

Ambitious Goals in a Changing Industry

The financial world uses AI fast, but doubts remain. Experts wonder if the current AI excitement will hold up. In response, RBC CEO Dave McKay sets high goals for AI work. He aims for up to $1 billion in extra revenue and cost savings by 2027. McKay stresses that RBC’s future depends on using data and AI well. The bank keeps spending around $5 billion each year on technology.

RBC: A World Leader in Bank AI

RBC’s effort shows. For the third year in a row, the bank ranks among the top three global financial firms for AI maturity. The Evident AI Index, a tool that checks innovation, research, patents, and skills in AI, confirms this. Toronto-Dominion Bank (TD) is the only other Canadian bank in the top ten worldwide. TD works closely with Toronto’s Vector Institute to build AI tools and grow talent.

Big Banks Face Hidden Hurdles

Being large does not make AI work simple. Alexandra Mousavizadeh, CEO of Evident Insights Ltd., explains that big banks have too many separate data pieces. “Big banks must move many pieces of data before AI can work smoothly,” she said. In this light, RBC’s early and steady investment in research and training at Borealis AI is key. Finance lecturer Jonathan Aikman at Queen’s University sees Borealis AI as the bridge that lets RBC turn raw data into useful insights and attract smart talent.

The Road Ahead

RBC speeds up its AI work as the industry watches. Many will note if the bank’s large spending gives it an edge and better service for customers. With Borealis AI inside and McKay’s bold money targets, RBC stands at the leading edge of banking’s digital shift. The road is not without risks. Yet the bank’s approach shows a strong belief in AI as a core part of future banking. The years ahead will show if this bet brings the rewards it promises and sets a guide for other banks in Canada and beyond.

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Unlocking Economic Potential: How OSFI’s Relaxation of Lending Rules Could Propel Canadian Banks to Lend $1 Trillion

Canada’s Banking Regulator Explores Measures to Boost Business Lending Amid U.S. Trade War

By Barbara Shecter | Financial Post | September 17, 2025

Canada’s federal banking regulator, OSFI, considers new rules. OSFI wants Canada’s biggest banks to lend more to businesses. Canada faces economic challenges. A trade war with the U.S. makes change urgent.

Banks Could Potentially Lend an Additional $1 Trillion

Peter Routledge, OSFI’s head, spoke at a recent event. He noted that major banks built strong capital buffers during hard times. They earned these buffers during COVID-19 and after the 2023 Silicon Valley Bank collapse. Banks keep these buffers so they can lend more money. Routledge said banks could offer nearly $1 trillion in new loans. They would still meet capital rules. Compared to Canada’s $3-trillion economy, this sum is large. Routledge sees a chance to fund the country’s economic shift.

Potential Focus on Public-Private Infrastructure Projects

OSFI has not set final rules. One idea eases capital requirements on many business loans. These loans would support public-private projects. OSFI has taken similar steps before. In July, it lowered capital rules for life insurers investing in infrastructure. This idea fits a broader push to back key projects.

Leveraging System Resilience as a Catalyst for Growth

Routledge stressed the strength of Canada’s banking system. He pointed out that the system grew resilient after the 2008 crisis. The banks’ strong buffers can do more than protect. They can help fuel growth. Routledge asked banks to share ideas that boost lending without risky moves. He sees the system’s strength as a tool for supporting businesses and households. He stressed that well-run banks help keep credit and financial services available.

Trade War and Economic Adaptation

Canada faces a long-running trade dispute with the U.S. The Canada-U.S.-Mexico Agreement is up for review in July 2026. The U.S. Trade Representative has already started looking at the deal. Some expect the U.S. to press Canada for major changes. Despite these issues, Routledge stayed cautiously hopeful. He said the system’s strength might soften a tough trade outcome. He hoped for “maximum benefits and minimal costs” in negotiations. He added that Canada’s banks are ready to adjust when needed.

Canada’s Robust Financial System

Routledge pointed out that Canada’s financial system is more resilient than many others. He compared it to the U.S. system, where bank failures happen more often. He felt relief that shocks like the Silicon Valley Bank collapse in 2023 hurt the system only slightly. He admitted that future shocks are possible. OSFI works to keep the system both stable and flexible.

Government and Industry Outlook

Federal efforts are also in play. Ottawa launched a $5-billion fund to help businesses face trade war shifts. Together, government action and OSFI’s possible new rules form a two-pronged plan. This plan aims to boost resilience and get more business investments. As OSFI reviews its ideas, banks, businesses, and policymakers will watch closely. They want capital rules that balance risk with the need for more lending.

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Major Banks Lower Prime Rate to 4.70%: What It Means for Canadians Following Central Bank’s Cut

Canadian Banks Lower Prime Rate to 4.70%, Following Bank of Canada Rate Cut

September 17, 2025 – The Bank of Canada cuts its main rate. In response, Canadian banks lower their prime rate. They set it at 4.70% starting September 18. This rate drops 25 basis points from 4.95%. The change follows a quarter-point cut by the central bank to 2.5%.
• Banks act after the Bank of Canada signals a softer monetary plan.
• Royal Bank of Canada, Toronto-Dominion Bank, Canadian Imperial Bank of Commerce, Bank of Montreal, Desjardins Group, National Bank of Canada, Laurentian Bank of Canada, Equitable Bank, and Bank of Nova Scotia agree with the move.

Impact of the Rate Cut

The prime rate guides many loans across Canada. It affects mortgage rates, personal loans, credit cards, and other variable-interest deals. Lowering the rate to 4.70% should ease borrowing costs. Consumers and businesses with variable loans may find relief in tighter conditions.
Analysts view this change as a quick fix for slowing inflation and steady economic growth. Banks and the central bank work together to boost spending and investments.

What Borrowers Should Know

Variable-rate borrowers will see lower charges soon. Homeowners with variable mortgages might pay less each month if their lender passes on the cut.
New borrowers may soon get better loan terms. Experts advise that borrowers watch future monetary moves. Banks may change rates again if economic data shifts.

Conclusion

Canada’s major banks now lower the prime rate. Their decision follows the Bank of Canada’s rate cut. This step shows a clear link between central bank actions and commercial lending. The goal is to ease credit and support the economy amid current challenges.

For more in-depth coverage and analysis, readers are encouraged to subscribe to the Financial Post, which provides ongoing updates on economic policy, market trends, and financial news across Canada.

Photo credit: Wikimedia Commons – Bank buildings in Toronto’s Financial District

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Empowering Housing: CMHC’s Vision for Increased Bank Risk-Taking in Construction Financing

CMHC Head Emphasizes Continued Importance of Crown Corporation in Canadian Housing Sector

By Garry Marr | Published September 12, 2025

At a recent industry conference in Toronto, Coleen Volk, president and CEO of Canada Mortgage and Housing Corporation (CMHC), made a clear point. She stressed that the Crown corporation plays a key role in Canada’s housing challenges. Volk spoke at the Canadian Apartment Investment Conference. She linked private banks with new funds for residential building. At the same time, she reassured us that CMHC stands by the housing market by taking smart risks.

Welcoming More Risk from Banks in Housing Finance

Volk wants banks to take more risks when they finance housing projects. She said, “We would love to see the banks taking more risks,” during a one-on-one Q&A with Ana Bailão, an affordable housing advocate and former Toronto mayoral candidate.
Today, about 88 percent of housing projects rely on CMHC mortgage insurance. This data shows that banks are careful. Volk’s words show that CMHC hopes to share risk more evenly with private lenders. This change may bring new money to build homes.

Regulatory Environment and Risk Considerations

Volk explained that OSFI, the Office of the Superintendent of Financial Institutions, watches over CMHC. Recently, OSFI raised the capital rules for the corporation. Volk said, “We don’t want that to limit our ability to do good things in the marketplace.” Her words tied the need for balance between safe risk-taking and meeting housing needs.
CMHC sees that the nation does not build enough homes. Its chief economist linked this problem to only half the needed annual housing starts. New data showed that in the first half of 2025, housing starts across the country fell compared to 2024. Toronto, in particular, sees its housing starts drop to a three-decade low.

CMHC’s Role Amidst New Government Housing Initiatives

Volk spoke about Ottawa’s Build Canada Homes program. This new plan will boost federal activity in building affordable, or “deeply affordable,” homes. Volk compared it to the Canada Infrastructure Bank. She noted that Build Canada Homes will work mostly outside CMHC’s usual area.
She made clear that CMHC will keep its own affordable housing programs, some of which are 30 years old. Build Canada Homes will focus on larger affordable housing projects. Volk said, “If they are taking over things that we did, it would be from that end of the spectrum, the more affordable end.” Meanwhile, CMHC will handle market housing.

Continuing Support for Rental Apartment Construction

CMHC also backs its Apartment Construction Loan Program. This program gives developers low-cost funds to build rental apartments across Canada. Volk said, “We are really firing on all cylinders there.” She linked her optimism to a plan to double the funds for this initiative.
She challenged the notion of two separate markets for affordable and market housing. Her words tied the two segments together. Volk stressed that both CMHC and Build Canada Homes will serve similar clients in a mixed housing market.

Conclusion

Coleen Volk’s remarks at the conference tied CMHC’s role firmly to Canada’s housing market. Her words link private banks with new funding, while CMHC’s leadership keeps pushing for more housing supply. The message is clear. Despite tighter rules and a national housing shortage, CMHC will keep supporting both rental and affordable housing projects.

For further details, reach out to Garry Marr at gmarr@postmedia.com.

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Brookfield’s Bruce Flatt Sees Bright Future for New York Real Estate Amid Expert Insights on Market Recovery and Rate Cuts

Brookfield CEO Bruce Flatt Bullish on Real Estate Rebound Amid Lower US Interest Rates

Brookfield Asset Management CEO Bruce Flatt shows clear confidence in a real estate rebound. He points to strong market changes and lower U.S. interest rates. Flatt signals that now is a good time to invest, especially in New York City. He explains his view at Brookfield’s annual investor meeting in New York.

Scarcity of New Construction Spurs Rent Growth

Flatt notes that few large office buildings are built in New York City. London sees the same trend. Less new construction and higher demand mean rents will rise. “In the next five years, rents are going through the roof,” Flatt said. He adds that limited supply, strong demand, changing rates, and easier financing come together to lift the market.

Anticipated US Interest Rate Cuts to Fuel Market Recovery

Flatt expects U.S. interest rates to drop by about 100 basis points in the next 12 to 18 months. This drop will ease financing challenges. “Transaction activity has come back,” Flatt noted. “Now you can finance nearly everything in real estate worldwide. Real estate depends on financing.” Even if office and retail segments face challenges, strong fundamentals keep the market steady.

US Market Poised to Catch Up to Other Regions

The recovery in Canada is ahead because of faster rate cuts. The U.S. market lags a bit. Flatt points out that when U.S. rates fall, the market will speed up. “Other markets have already turned, but in the U.S. we are waiting for lower rates. That change will drive recovery further,” he explained.

Brookfield’s Strategic Positioning in Real Estate and AI

Brookfield has stayed active in real estate while others let go. This steady approach gives the firm an edge when the market bounces back. Flatt also stresses a big move into artificial intelligence (AI). He calls AI a $7-trillion opportunity. If Brookfield follows through, AI-related businesses may become the firm’s largest segment in ten years. The firm is investing in AI infrastructure with plans worth around $200 billion, many with real estate links.

“We’re building core AI to drive productivity in businesses,” Flatt remarked. He explains that AI will change every business. Staying ahead in this tech race is key to remaining competitive.

Expanding Access to Alternative Investments

Brookfield is also opening doors for U.S. retail investors. It offers ways to invest in alternatives like private equity and real estate. This move follows U.S. government steps that let more people invest in alternative assets through employer plans.

Bruce Flatt’s confident outlook shows that key real estate markets are set to grow as financing improves. With bold investments in AI and smart real estate play, Brookfield aims to lead global investment trends in a changing market.

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Bank Regulator Highlights Silver Linings Amidst Toronto’s Condominium Market Challenges

Condominium Market Challenges Offer Silver Lining, According to Canada’s Banking Regulator

By Barbara Shecter, Financial Post — September 3, 2025

Toronto – Canada’s urban condominium markets face challenges. The GTA and Vancouver show slowing condo sales and rising inventories. Peter Routledge, head of the Office of the Superintendent of Financial Institutions (OSFI), sees hidden benefits in these trends. He links the tough market conditions closely to potential gains for buyers.

At the Scotiabank Financials Summit in Toronto on Wednesday, Routledge focused on the slowdown in sales and increase in new condo inventories. He noted that Toronto lost 75 percent of its condo sales from 2022 to 2025, while Vancouver saw a 37 percent drop. Despite these falls, he stressed that Canada’s banks are still strong and well-capitalized to handle these issues.

Oversupply and Price Adjustments

In the GTA, the market shows a clear oversupply. New condo completions rise quickly. A report from Altus Group Ltd highlights both the oversupply and the steady stream of new builds. This excess pushes down prices and rents during the first half of 2025. Data released in June by Canada Mortgage and Housing Corp. (CMHC) backs this view. It reports fewer sales, nearly double the inventories, and softer prices across urban Canada. These trends follow a long phase of high prices and a low supply of housing.

A Market Correction Helping Affordability

Routledge sees the slowdown as a chance to improve affordability. He explained that not long ago, many noted the lack of housing units for Canadians. Now, the buildup of condo supply can help young buyers. Prices are falling from their high peaks, which may help first-time buyers enter the market.

This market correction can make owning a home more reachable by easing pressure on prices.

Banking Sector Preparedness and Market Resilience

OSFI has set up strong safeguards to support banks. They have set clear capital requirements and stress-tested mortgages. These steps help banks manage shocks from the real estate sector. Even though risks remain—especially in commercial real estate and slow-selling condo projects—the system stays robust. Routledge reassured that if stability is the focus, the system is doing well.

Letting the Market Find Its Level

Routledge agreed that some condo developments may fall short of investor hopes. Still, he favors market forces over strict regulation. He said, “We have the resilience already. The goal is to let the market decide the price that will bring young Canadians in so they can afford a home.” His words stress that careful letting of supply and demand should set the right prices.

Broader Implications

While a slowing condo market might seem bad at first, it can help balance Canada’s urban housing supply. This shift may ease long-standing affordability issues and open the door for new buyers. The challenge may not spell disaster for everyone but instead point to a more accessible housing market in major cities.

Contact: Barbara Shecter, bshecter@nationalpost.com
Financial Post
Photo credit: Peter J. Thompson / Financial Post

Related Reads:

  • ‘From bad to terrible’: Toronto’s market for new condos has fallen off a cliff
  • Investor mortgages have surged: 12 financing questions for new landlords

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