Relationship and risk management

The Credit Union and Prudential (CU&P) Relationship and Risk Management team (RRM) works closely with credit union personnel to ensure their success. The team identifies risks, assesses issues and weaknesses, and provides guidance and expectations as needed. The team regularly reviews:

  • Credit union risks, quality of risk management, and corporate governance
  • Operational and financial performance
  • Business plans and strategies
  • Board and committee packages

CU&P relationship managers may request to attend credit union board meetings or to receive board and committee packages as a way of better understanding operations and oversight.

Recovery and resolution

The CU&P Recovery and Resolution team within RRM is responsible for developing and implementing the recovery framework and resolution regime. The objective is to promote crisis preparedness, improve resiliency in credit unions and enhance the financial stability of the system. The work is implemented collaboratively in consultation with internal and external stakeholders.

RRM is responsible for the intervention, recovery and resolution activities to rehabilitate a credit union or resolve issues, including the potential placement in an appropriate depositor protection program.

Monitoring and analysis

CU&P's Monitoring and Analysis team collects and analyzes credit union data to assess risk and promote compliance in the sector. The Monitoring and Analysis team provides analytical support to the Relationship and Risk Management team.

Examinations

CU&P’s examination process measures a credit union’s compliance with the Credit Unions and Caisses Populaires Act, 1994 (the Act) and regulations, FSRA rules, FSRA’s By-Law No. 5, and Standards of Sound Business and Financial Practices and other guidance publications. Examinations are aligned to the risk profile of the credit union.

Once CU&P has made an assessment, a full report will be issued including findings from the examination and their respective corrective actions. These reports are tracked to completion by our Relationship Management team to ensure credit unions complete all requirements.

Preparing for an examination

The following workbooks will give credit unions some insight into what to expect through the course of a FSRA examination:

Policy and Research

The Policy and Research department works in tandem with the Policy - Credit Unions team. Together, they develop new rules, guidance and standards for the sector on specific risk management issues such as corporate governance and liquidity risk management. These are typically aligned with domestic and internationally recognized standards and Basel III globally accepted best practices advocated committees and other recognized regulatory bodies and committees.

Transactions and events

FSRA also has the authority to ensure that credit unions manage their operations in a prudent manner. The Act requires that credit unions apply to FSRA for approval of all business activities, including:

  • Investments and share offerings
  • Amalgamations
  • Asset purchase and sales
  • Incorporation and registration of new credit unions
  • Dissolution of credit unions
  • Articles of amendment
  • Extra-provincial registrations
  • Acquiring or establishing a subsidiary
  • Borrowing from another credit union
  • Investing in another credit union
  • Creating a group capital agreement
  • Certificates of status
  • Filing by-law amendments

For further information on regulatory applications and other further information on regulatory applications and other transactional matters, please contact us via email at CreditUnionTransactions@fsrao.ca.

An Ontario credit union may also apply to FSRA for approval for variations and exemptions to certain specified requirements of the Act, including:

  • Capital and liquidity requirements
  • Guarantees and exemptions to aggregate limits for guarantees
  • Increase in lending limits
  • Extension to divestment period for securities
  • Deemed prescribed subsidiaries
  • Investment requirements
  • Acceptance of unauthorized securities and other assets obtained upon amalgamation

FSRA may approve a temporary variation or exemption in in exceptional circumstances where it meets established criteria.