Bank of Canada to introduce a Standing Term Liquidity Facility

Bank of Canada to introduce a Standing Term Liquidity Facility

 

The Bank of Canada (Bank) has announced that it intends to introduce a new liquidity facility, the Standing Term Liquidity Facility (STLF)

 

The STLF will complement the Bank’s current tools for the provision of liquidity and will strengthen its role as lender of last resort.

 

Under the proposed STLF, the Bank could provide loans to individual prudentially regulated members of Payments Canada that are experiencing idiosyncratic stress where the Bank has no concerns about their financial soundness. 

 

The Bank indicates it will conduct targeted industry consultations to refine the design of the STLF. 

 

However, other interested stakeholders are also welcome to provide comments on the proposed design by email to STLF-consultation@bank-banque-canada.ca by December 13, 2019.

 

Photo Credit: adam morgan from Pixabay

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