Based on the rules set by the bank of canada, the two options are two reduce the lvts position to zero, or essentially pay a penalty to the bank of canada. If you have a surplus and do not make the effort to loan out the funds to reduce the balance to zero, you will be paid a rate by the bank of canada on your surplus funds that falls below the going market rate. If you have a deficit and do not make the effort to borrow funds to cover the deficit, you will be charged a borrowing rate by the bank of canada that sits above the going market rate. From this you can see its in the best interest of all institutions to reduce their lvts positions to zero to avoid the less desirable option presented by the bank of canada.
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