Canadian Securities Course (CSC) Level 1 Practice Exam 2026 - Free CSC Level 1 Practice Questions and Study Guide

The correct answer highlights the role of the Office of the Superintendent of Financial Institutions (OSFI) as an independent agency that plays a crucial role in maintaining the stability and safety of the Canadian financial system. OSFI’s main functions include regulating and supervising federally regulated financial institutions, which encompasses deposit-taking banks, insurance companies, and pension plans. Through these responsibilities, OSFI ensures that these institutions operate safely and soundly, thereby fostering public confidence in the financial system and protecting the interests of depositors and policyholders. This oversight is vital for the overall integrity of Canada’s financial sector, making the agency's contribution significant for economic stability.

The other options incorrectly characterize OSFI’s role and functions. An international organization regulating stock exchanges does not describe OSFI’s mandate; it focuses on domestic financial institutions rather than stock market regulation. A department within the Ministry of Transportation misrepresents OSFI’s independence and functions, as it has no affiliation with transportation but rather with financial institutions. Similarly, describing OSFI as an advertising agency promoting financial services ignores its regulatory and supervisory duties, which are critical for ensuring the health of the financial sector.