New CDIC differential premiums by-law

Summary#

The Canada Deposit Insurance Corporation (CDIC) has replaced its differential premiums rules with the new Canada Deposit Insurance Corporation Differential Premiums By-law (SOR/2025-165). The by-law makes CDIC’s premium system more risk‑sensitive, moves from one annual classification to two each year, and changes how member institutions’ yearly insurance premiums are calculated. It comes into force on April 29, 2026 (with one small part on July 16, 2026).

What it does#

• Introduces a semi‑annual classification. CDIC will classify each member as of January 15 and July 15 each year, using fall and spring data respectively.
• Replaces the old premium categories with five categories. The category rates (used in the premium formula) are 22.5%, 27%, 40.5%, 72.9%, and 100%.
• Changes the premium calculation so the annual charge is based on insured deposits and the average of the two semi‑annual category rates. The formula uses a base factor equal to 1/3 of 1% of insured deposits (subject to change by government).
• Sets a minimum annual premium of $5,000.
• Requires two regular returns:
  • a “fall return” by October 31 each year (using data as of the end of the institution’s second quarter), and
  • a “spring return” by April 30 each year (using data as of the end of the most recent financial year).
• If a required return is late or missing, CDIC treats the days without data as if the institution were in the highest‑rate category (Premium Category 5).
• Introduces a new CDIC Risk and Resolvability Score (RRS) and updates the examiner’s rating scale used for qualitative scoring.
• Updates quantitative score metrics, adds liquidity and funding measures, and creates separate criteria for large systemically important banks and for smaller deposit‑taking institutions.
• First fall return under the new system must be submitted by October 31, 2026, and the first premium year using the new semi‑annual process begins May 1, 2027.

Who's affected#

• Primarily CDIC’s member institutions — that is, federally or provincially regulated deposit‑taking institutions that are insured by CDIC.
  • This includes domestic systemically important banks (D‑SIBs) and smaller banks and credit unions covered by CDIC.
• New entrants to the CDIC membership are treated differently: a new member is generally placed in Premium Category 2, unless specific exceptions apply (for example, if it has been given an OSFI "stage of intervention," in which case it may be placed in Category 3).
• Institutions that miss reporting deadlines, or have weak risk or resolution plans, may face higher premiums.
• The by-law also updates how subsidiaries, amalgamations and “bridge institutions” are classified, so groups with those structures should pay attention.

Why it matters#

• For banks and credit unions: the new rules can change how much you pay in CDIC insurance premiums. Some institutions may pay more, others less, depending on their updated risk scores and reporting timeliness.
• For depositors: the changes aim to make CDIC’s premiums better connected to risk. That helps ensure the deposit insurance fund reflects institutions’ true risk and supports CDIC’s ability to protect depositors if a member fails.
• For new or small institutions: the by-law sets clearer initial classifications, which can affect early‑years costs and incentives to meet data and resolution planning requirements.
• For regulators and markets: more frequent classification and new liquidity/funding metrics mean CDIC will react faster to changes in an institution’s financial health. This creates stronger incentives for institutions to maintain good risk management and timely reporting.