Stéphane Lavoie was appointed Deputy Managing Director of the Financial Markets Department (FMD), effective December 10, 2018, returning to a position he previously held from 2013 to 2016. In addition, Mr. Lavoie is Senior Director of the Bank’s Calgary Operational Site (COS). As Deputy Managing Director he provides strategic direction and senior leadership to FMD for a variety of issues related to the financial system and to funds management. He is responsible for overseeing the Bank’s trading operations, including those related to domestic market operations and the Exchange Fund Account. As the leader of the COS, Mr. Lavoie oversees the team supporting market and banking operations in Calgary.
Mr. Lavoie joined the Bank in 2001. He has a wealth of experience in financial markets analysis and operations, including collateral and liquidity policies, as well as in monetary policy, financial system and funds management issues. Previously, Mr. Lavoie served as Deputy Managing Director of the Bank’s Funds Management and Banking Department, and as co-chair of the Foreign Reserves Committee, the Debt and Treasury Management Committee, and the Retail Debt Committee. He also served as a member of the Bank of Canada’s Pension Fund Investment Committee and has represented the Bank on various international committees.
Mr. Lavoie graduated with a Bachelor of Business Administration degree and an MBA in Finance from Université Laval and holds the Chartered Financial Analyst designation.
The recent crisis was characterized by widespread deterioration in funding conditions, as well as impairment of the mechanism through which liquidity is normally redistributed within the financial system. Central banks responded with extraordinary measures. This article examines the provision of liquidity by central banks during the crisis as they adapted their existing facilities and introduced new ones, while encouraging a return to private markets and mitigating moral hazard. A review of this experience illustrates the importance of clear principles for intervention, a flexible operating framework, and clear communication and co-operation by central banks. By exposing the degree of interdependence of financial institutions and markets, the crisis highlighted the need for reforms aimed at improving the infrastructure supporting core funding markets and the liquidity of individual institutions.