Executive Summary

The Canada Deposit Insurance Corporation (CDIC) helps safeguard the stability of the financial system by providing deposit insurance against the loss of eligible deposits at member institutions in the event of failure, and by ensuring the orderly resolution of troubled member institutions.

Canada’s economy is facing continued headwinds due to global and domestic factors, including tighter monetary policy, rising interest rates, geo-political tensions, and low housing affordability. In 2022, this resulted in cost-of-living pressures and a decline in real and financial asset values. For Canadian businesses, the year ahead outlook is cautious. Businesses continue to navigate a tight labour market and worker skill shortages. Borrowing costs are on the rise. Real business investment in Canada continues to lag behind pre-pandemic levels. CDIC’s member institutions are facing a period of economic uncertainty. However, member institutions are in stable financial condition due in part to capital and liquidity buffers and well-regulated funding standards for members. Nonetheless, CDIC will continue to focus on strengthening its readiness to respond to a variety of these circumstances and possible shocks to the financial system.

Alongside these conditions, the pace of digitalization and innovation in the financial sector is resulting in new financial products, services, and players, which are fundamentally changing the financial sector landscape. CDIC will work proactively to ensure that the deposit insurance, resolution frameworks, and operations remain fit for purpose. CDIC will also strive to increase awareness of deposit insurance to maintain depositor confidence and reinforce financial sector resilience as the landscape continues to evolve.

The digitalization of finance has implications for how Canadian depositors access their money and for the security of their data against cyber threats. To maintain depositor confidence, CDIC is transforming its technological capabilities to increase the speed, security, and convenience of access to insured deposits in the event of a member failure.

CDIC is also evolving its workplace to respond to changes in the operating environment. There has been an acceleration of technological and cultural changes for all organizations, with competition for talent at an all-time high.

CDIC will continue to implement strategies to attract and retain top talent including through Indigenous partnerships to ensure that its employees are representative of Canada’s diverse population. As CDIC continues to experiment with a hybrid work model, CDIC will continue to adapt its technology, operations, and skills training across the organization to maintain flexibility for staff and capability to fulfill its mandate to serve Canadians.

CDIC will continue to embed Environmental, Social, and Governance (ESG) principles and initiatives into its operations to foster long-term sustainability and resiliency.

CDIC will focus on three strategic objectives for the 2023/2024 to 2027/2028 planning period, anchored to the Corporation’s mandate as deposit insurer and resolution authority:

1 — Be resolution ready

Being resolution ready involves having the necessary processes, tools, systems, and financial capacity, as well as the right people to allow CDIC to resolve a member institution if necessary. This is important because CDIC’s role within Canada’s financial safety net intensifies during times of economic hardship or uncertainty and being resolution ready is a key element in promoting financial stability.

2 — Reinforce trust in depositor protection

Depositor confidence in the safety of their deposits is essential to CDIC’s mission to serve Canadians, and for the stability of the financial sector. CDIC will reinforce trust in depositor protection by anticipating and responding to innovation in the financial sector to ensure that the deposit insurance and resolution frameworks, as well as CDIC’s operations, remain fit for purpose to maintain depositor confidence.

3 — Strengthen organizational resilience

Strengthening organizational resilience involves addressing internal and external factors that can impact CDIC’s technologies, people, and culture. CDIC will enhance the efficiency and effectiveness of its systems, technology, operations, and skills training to ensure that the Corporation can continue to fulfill its mandate while being prepared for the workplace of tomorrow.

In fiscal 2023/2024, CDIC’s operating budget will be $89.1 million, and its capital budget will be $3.8 million.

CDIC maintains ex ante funding to cover possible deposit insurance losses. The amount of such funding is represented by the aggregate of CDIC’s retained earnings and the provision for insurance losses. CDIC’s ex ante fund totalled $7.9 billion (73 basis points of insured deposits) as at December 31, 2022.

The Corporate Plan anticipates and responds to the evolving operating environment and risks facing CDIC and supports the Corporation’s achievement of its mandate while striving to maintain Canadians’ confidence that their eligible deposits are protected.