Office of the Superintendent of Financial Institutions
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It has been a privilege to serve my first year as Superintendent of Financial Institutions, and to helm an agency that plays a central role in maintaining the safety and soundness of Canada’s financial system for the benefit of all Canadians.
In 2014-15, the Office of the Superintendent of Financial Institutions (OSFI) undertook a number of initiatives to further strengthen Canada’s system of financial regulation and supervision.
OSFI issued the Residential Mortgage Insurance Underwriting Practices and Procedures guideline, following extensive consultation with the industry. The guideline enhances disclosure practices for mortgage insurers and outlines sound risk management principles, including setting prudent requirements for lenders and applying appropriate due diligence to lenders’ practices. OSFI also issued new or updated guidelines on Leverage Requirements and Liquidity Adequacy Requirements for deposit-taking institutions, Minimum Continuing Capital and Surplus Requirements for life insurers, and the Minimum Capital Test for property and casualty insurers.
Canada’s strong regulatory regime is a result of the cooperation and collaboration that exists among our government partners, who are the Bank of Canada, the Department of Finance, Canada Deposit Insurance Corporation, and the Financial Consumer Agency of Canada. This collaboration was highlighted in the 2014 report of the International Monetary Fund’s Financial Sector Assessment Program review of Canada, which spoke favourably of the effectiveness of the oversight of Canada’s financial system.
Internally, OSFI continues to enhance both our supervisory capacity and processes. In 2014-15, we embarked on implementing a flatter organizational structure to broaden the executive team, improve communication within OSFI and reduce key person risk. We also launched a multi-year project that will enhance our supervisory methodology and processes, supported by the right enabling technology. Finally, we continued the development of a supervision training program to support the needs of supervisory employees, many of whom are relatively new to OSFI.
In my first year as Superintendent, I have observed close at hand the sustained dedication of my OSFI colleagues. Their professionalism, knowledge and integrity greatly contribute to our collective success and allow Canadians to continue to have confidence in Canada’s financial system.