Credit Unions

Calculation of Premium Rates and Billing Amounts

1. How were the premiums rates calculated for 2019?

The calculations of 2019 premiums were based on the Differential Premium Score Determination System (DPSD) that has been in place since 2015. The DPSD system uses three components in the calculation of premiums:  the amount of capital, governance scores from examinations and the level of the insured deposits. 

2. How will billing amounts be calculated next year?

Beginning April 1, 2020, the billing amounts will be split into two separate calculations for Deposit Insurance Premium and Prudential Oversight Assessment and will be included in two invoices.

Deposit Insurance Premiums

3. What is Deposit Insurance Premium?

Deposit Insurance Premium is a fee that the credit unions pay to the Deposit Insurance Reserve Fund. These funds insure deposits in the event that a credit union does not have sufficient funds at the time of its failure.

4. What is DIRF Accumulation Factor of 75%?

DIRF Accumulation factor is the percentage needed to ensure that DIRF funding continues to grow at the same rate.

Prudential Oversight Assessment

5. What is Prudential Oversight Assessment?

Prudential Oversight Assessment is the fee that a credit union pays that is attributed towards the cost of regulating the credit union industry. It uses the credit union’s proportional amount of total sector risk-weighted assets  as the basis for the assessment calculation.

Calculation Methodology and Invoice Amounts

6. What are the new methodologies?

The calculation for Deposit Insurance Premiums will follow the existing DPSD methodology with the addition of DIRF Accumulation Factor of 75%.

The calculation for Prudential Regulation Assessment will follow the new FRSA Fee Rule and will be based on a credit union’s level of risk weighted assets (RWA).

7. Why did my total invoicing change from last year?  

Assessments issued by FSRA are based on the FSRA Fee Rule that came into effect on May 24, 2019. The calculations are based on the risk-weighted assets (RWA) model. This will have impacted your 2020-2021 assessment.  For more information on the assessments and fees under FSRA visit: 

  1. Financial Services Regulatory Authority of Ontario Rule 2019-001 Assessments and Fees  
  2. Proposed Amendments to the General Regulation (O. Reg. 237/09) under the Credit Unions and Caisses Populaires Act, 1994 Regarding Deposit Insurance Premiums

8. What will be included in my invoice?

Total yearly invoicing will include two separate invoice amounts for the Deposit Insurance Premiums and the Prudential Regulation Assessment. Depending the the fiscal year end of the credit union, the invoices may be sent out at different times during the year to align with the invoicing requirements set out in the CUCPA and the FSRA Act.

9. Are all credit unions charged the same amount?

FSRA will use a risk-weighted assets methodology as the basis for calculating prudential oversight assessments. The amount that each credit union will be charged will vary by credit union and will represent their portion of the total sector’s risk weighted assets.

10. When will I receive an invoice from FSRA?

Invoices for Prudential Assessments are being sent out in July 2020 for the 2020-21 year.  Going forward the assessments will be issued in March/April of each year.  Deposit Insurance premium invoicing will be issued 90 days after the credit union’s fiscal year end.

11. Who do I contact for more information?

For more information about Deposit Insurance Premiums and Prudential Assessments, please contact the relationship manager for your credit union.