Investment Policies

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J.R. LaBrosseDirector, International Affairs

Canada Deposit Insurance Corporation

Presentation to the IADI/EBRD Seminar on Deposit InsuranceDecember 9, 2003

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Purpose of this Presentation

Factors to consider in Devising Investment Policies for Deposit Insurers

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Responsibilities of Management

•Setting out a policy•Determining risk tolerances

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Governance framework

•Processes•Will the function be outsourced?•Decision making•Reporting

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Policy Considerations

Determining the purpose of the portfolio will lead to an understanding of the risk tolerance that

can be accepted by management

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Determining risk tolerances of the investment portfolio

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Risk tolerance conclusions

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Evolution of CDIC’s investment policy

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Investment policy limitations:

• Credit risk• Counterparty risk• Maturity Profile• Liquidity Risk by Issuer, and• Portfolio Liquidity Risk

Investment Policies

www.iadi.org

Presentation to the IADI/EBRDSeminar on Deposit InsuranceDecember 9, 2003

Presentation by:J.R. LaBrosse

Canada Deposit Insurance Corporation