July 26, 2016 / 3:02 PM / 2 years ago

Canada watchdog tells banks to test resilience to sharp home price falls

TORONTO, July 26 (Reuters) - Canada’s banking regulator said on Tuesday it will require the country’s banks to test how they would withstand a 50 percent cut in property prices in Vancouver and a 40 percent decline in Toronto.

The move is the latest in a series of moves by Canadian authorities to counter a threat posed by soaring house prices in the two Canadian cities. OSFI said earlier this month is was tightening oversight of mortgage lending, citing concern about record household debt and a sharp jump in prices.

Reporting by Matt Scuffham

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