Office of the Superintendent of Financial Institutions Canada : The Office of the Superintendent of Financial Institutions (OSFI) is responsible for the regulation and supervision of all federally chartered, licensed or registered, banks, insurance companies, trust and loan companies, cooperative credit associations, fraternal benefit societies and private pensions with the goal of promoting public confidence in the Canadian financial system. The OSFI was created in 1987 as an independent agency of the Government of Canada. It was formed through a merger of the Department of Insurance (DOI) and the Office of the Inspector General of Banks (OIGB).
The DOI and OIGB were created in the first half of the 20th century in response to the increasing realization that bank returns, which banks were required to submit to parliament under the legislation of 1856, were found to provide insufficient protection for the public, and it became clear that some form of inspection or audit was necessary. Initially, shareholders' audits conducted by an independent auditor was thought to afford the additional protection required. However, the weakness of this arrangement became evident when the Home Bank failed in 1923. A new form of government inspection was then put in place. A new officer of the Department of Finance was appointed and given the title of Inspector General of Banks (14-15 Geo. V, c. 7). They were given a mandate to inspect the head offices and main branches of all the banks in Canada at irregular intervals and report thereon to the Minister of Finance. Furthermore, copies of all reports prepared by the auditors for the general managers and directors of banks had to be submitted to the Minister of Finance.
Ultimately, the DOI and OIGB were responsible for overseeing all federally licensed life insurance, property and casualty insurance companies, trust and loan companies, pension plans, providing actuarial services to the government, and regulating Canada's chartered banks, respectively. In the decades following the Second World War, the Government of Canada gradually placed greater focus on financial sector reform. Two Royal Commissions, the Macmillan Commission and the Porter Commission conducted in the early 1960s, were key in the development of a system that would "provide for adequate disclosure and set high standards of self-regulation, backed up by strong government supervision and powers to enforce proper practices".
One of the developments that came out of these commissions included the establishment in 1967 of the Canada Deposit Insurance Corporation (CDIC) to ensure the safety of deposits and to bring about a gradual improvement in the minimum financial standards of deposit-taking institutions in Canada. During the 1970s and 1980s, the Government of Canada revised the Bank Act and in 1985, it addressed the aftermath of the failures of the Canadian Commercial Bank and the Northern Bank by rethinking its approach to the regulatory structure and the need to create a significant impetus for action in monitoring such institutions. Thus in 1987 the two predecessor organizations were merged to create the OSFI.
