Because of that 90% guarantee and 10% excess risk, banks have to set aside additional capital to protect against that tail risk. Banks do set aside capital in that instance.
On January 30th, 2017. See this statement in context.
On January 30th, 2017. See this statement in context.
January 30th, 2017 / 6:55 p.m.
Director, Credit Market and Economic Policy, Canadian Bankers Association
Because of that 90% guarantee and 10% excess risk, banks have to set aside additional capital to protect against that tail risk. Banks do set aside capital in that instance.
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