Earnings & Dividend Growth Presentation
How Will Bail-in Work?
Business
as usual
Resolution
Bail-in conversion
Stabilization /
restructuring
Heightened
risk
Point of non-
viability
Resolution
weekend
CDIC exits
Good
financial
health
•
Financial difficulties
DSIB may
implement recovery
plan actions under
OSFI oversight
• CDIC may monitor
and undertake
necessary
preparatory
activities
• DSIB may
experience declining
market confidence,
credit rating
downgrades and
funding capital
raising challenges
OSFI declares
the DSIB non-
viable
• Minister of
Finance, at the
request of CDIC,
recommends the
Federal Cabinet
to issue orders
authorizing
CDIC to assume
temporary
control or
ownership of the
DSIB and to
execute a Bail-in
conversion
. CDIC takes
control /
ownership of
the DSIB
•OSFI triggers
NVCC
conversion
•
Management
and Board of
DSIB
replaced if
necessary
⚫ 1-week to 1-
year timeframe
•
Common
shares resulting
from NVCC and
BID conversion
are issued
(voting rights
suspended)
Execution of
restructuring
plan
Liquidity
support if
necessary
• 1 to 5-year
timeframe
•
•
Voting rights
are resumed
"No creditor
worse off"
determination
and payment
of
compensation
Scotiabank | 42View entire presentation