Canada will not be adopting Solvency II’s European capital test: OSFI

Canada will not be adopting the Solvency II European capital test, Bernard Dupont, the managing director of the Office of the Superintendent of Financial Institutions (OSFI)’s capital division, told the 2010 IBC Financial Affairs Symposium in Toronto.Dupont said OSFI would be willing to examine any valuable aspects of the Solvency II European capital model, but the test would have to be in place and tested for at least 5-10 years before OSFI could determine its strengths.OSFI is making modifications to its standardized approach for determining minimal capital testing in Canada. Dupont noted the future framework is “likely to be similar to the current MCT/BAAT methodology.”