What is the Canadian banking industry currently experiencing?

The answer is: The major test of Basel IV reform. As one of the first countries to take the plunge, the Bank of Canada now has to deal with over 30,000 validation rules, more complex capital calculations, and the restructuring of risk-weighted assets.

Latest update: OSFI just announced in July this year a one-year delay in raising the output floor (from 67.5% to 72.5%), originally scheduled for 2026 and now pushed to 2027. It seems like a sigh of relief, but in reality, it is giving banks a chance to catch their breath—the real challenge is still ahead.

For banks, this is not just a numbers game. From risk modeling to data infrastructure, from compliance processes to performance management, every aspect needs to be realigned. Those banks that rely on manual operations and outdated systems? They're starting to run into trouble now.

Why is the world watching Canada? Because it's other countries' turn to implement Basel IV next. Every step Canada takes in adapting now serves as a reference model for international regulators and the banking industry.

The core question is this: Can your current risk model withstand this wave of changes?