Bank regulator OSFI in annual report says....>

CANADA: Bank regulator OSFI in annual report says paying attention to mortgages,

commercial real estate, reliance on broker-deposit funding

-"A key focus has been addressing risks and vulnerabilities related to mortgage

lending, which continues to be elevated given low lending rates and significant

increases in household debt"

-"There is a risk that lenders could face material credit losses" if downturn

drives down home prices

-B-20 mortgage regulation is "having the desired effect," fewer loans made to

highly indebted households

-Also tracking debt to non-financial companies, "Business debt has seen

significant growth in the past few years with a growing proportion of weaker

structures, e.g. less strict loan covenants"

-Priority work next year includes oversight of operational resilience, cyber,

culture and conduct

-"Banks reported capital ratios well above the minimum common equity tier 1

(CET1) requirements"