Late 1800s – establishment of the Office of the Superintendent
of Insurance (OSI), which subsequently became the Department of Insurance
(DOI). The DOI was responsible for overseeing federally licensed life
insurance companies, property and casualty insurance companies, trust
and loan companies and pension plans, and for providing actuarial services
to the government.
1925 – the Office of the Inspector General of Banks was established
in response to the Home Bank failure and was responsible for regulating
Canada's chartered banks.
Early 1930s – MacMillan Royal Commission reviewed banking and
currency issues in the Canadian financial system.
Early 1960s – Porter Royal Commission reviewed structural and
operational issues affecting the financial system and financial institutions
in Canada. The Commission's report concluded the financial system was
sound, but developments had moved beyond the current state of laws and
regulatory practices. Porter argued the public could not be insulated
from loss in dealing with public institutions and markets. The Commission
called for a system that would provide for adequate disclosure and that
would set high standards of self-regulation, backed by strong government
supervision and powers to enforce proper practices.
1967 – the Minister of Finance introduced legislation to establish
the Canada Deposit Insurance Corporation (CDIC) to ensure the safety of
small deposits and bring about a gradual improvement in the minimum financial
standard of deposit-taking institutions in Canada. In 1983, legislative
amendments extended CDIC's mandate to include assisting to maintain public
confidence and stability in the financial system.
Mid-1980s – increased international competition and the failure
of two Canadian banks and the subsequent enquiry into these failures by
the Honourable Willard Z. Estey highlighted the need to ensure a sound
approach to handling the risks associated with the financial marketplace.
July 1987 – to ensure a coordinated approach to supervision and
a modern regulatory framework for Canada's financial system, and acting
on the recommendations of the Estey commission, the government proclaimed
the Financial Institutions and Deposit Insurance Amendment Act
and the Office of the Superintendent of Financial Institutions Act.
This latter Act joined the Department of Insurance and the Office of the
Inspector General of Banks to form OSFI, which was given the powers to
supervise and regulate all federally regulated financial institutions.
May 1996 – Bill C-15 receives Royal Assent. This new legislation
clarifies OSFI's prime responsibilities as helping to minimize losses
to depositors and shareholders, and contributing to public confidence
in the Canadian financial system. Preventing failure of financial institutions
is not part of OSFI's mandate; however, promoting sound business practices
helps reduce the risk that financial institutions will fail. The mandate
stresses the importance of early intervention to achieve OSFI's objectives
and establishes the basis for OSFI's mission, objectives, priorities and
strategies. |