The committee heard from Mr. Duguay, Deputy Governor of the Bank of Canada. He said that, in 2005, the Bank of Canada did issue warnings with respect to the extreme volatility of these securities—asset-backed commercial paper.
How is it that the Public Sector Pension Investment Board still decided to invest in commercial paper, even though it is a federal agency and the Bank of Canada is fairly closely linked to it? How is it that the Board still invested in these securities, particularly since only one rating agency, DBRS, had rated that investment and the others had declined to do so? That is quite troubling.