Regulatory Alerts1993-09-30
Commercial Lending Restrictions for Foreign Life Insurance Companies and Fraternal Benefit Societies
The Office establishes requirements for foreign life insurance companies and fraternal benefit societies to vest commercial loans in Canada, permitting up to 5% of vested assets to be commercial loans unless the company maintains a $25 million excess over liabilities. Organizations exceeding this 5% limit must implement documented lending policies, loan approval processes, and delinquency procedures to maintain their expanded vesting allowance. The Office enforces these standards through regular examinations, ensuring that commercial loan portfolios adhere to prudent lending practices and preserve adequate asset margins.
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