AI & Lending

The decision

On September 3, 2026, the Bank of Canada held its target for the overnight rate at 2.25%, with the Bank Rate at 2.5% and the deposit rate at 2.20%. It was the seventh consecutive hold, extending a pause that started when the Bank cut to 2.25% in October 2025. Governor Tiff Macklem confirmed the July Monetary Policy Report call for a "broadening recovery" in the economy - but framed inflation as the risk moving fastest. "Oil prices are back up," Macklem told reporters in Ottawa. On tariffs, he was blunter: "The counter-tariffs, and indeed the US tariffs will add costs for some businesses. These tariffs are very steep, but they are applied to a relatively narrow base." The war in the Middle East, he added, is the "bigger issue" for inflation.

The report

On August 27, 2026, Bloomberg published a piece arguing that AI will help homeowners whose loans are ripe for refinancing secure new, cheaper loans "far faster." The reporters cited Morgan Stanley research showing that when rates fall, only about one-third of homeowners who could save meaningfully by refinancing actually do so - largely because the process is "notoriously drawn-out and tedious." The stated implication: faster refis will squeeze investors in the $9 trillion US mortgage bond market.

Canada's banking sector just received a wake-up call, and it came from the regulator.

The maximum fine for failing to report suspicious mortgage activity just jumped from half a million to twenty million dollars. That is not a typo. Welcome to the new reality of Canadian mortgage lending compliance.

Gone are the days when lenders rely on emails and accessing consumer information through unsecured systems. The Financial Services Regulatory Authority of Ontario (FSRA) is proposing guidelines to support the lending industry and cybersecurity preparedness. This is big news for the Canadian mortgage industry.