Bank of Jamaica Governor (BOJ) Richard Byles, has sought to assure management and staff at the Financial Services Commission (FSC) that the Commission’s new board, which he has been appointed to chair, will be relying on their “continued dedication and professionalism” in charting the future direction of the body and “implementing the tangible steps towards achieving the stated objectives of the Government”.
In a statement on the transition to a ‘Twin-Peaks’ Regulatory Framework for the supervision of deposit-taking and non-bank financial institutions – in wake of the multibillionaire fraud scandal this month unveiled at investment firm Stocks and Securities Ltd (SSL) – the BOJ said it was preparing its operational systems and personnel to effectively transition to the new model.
Under the Twin-Peaks framework, once it is implemented within the stated 18-24 months transition period, the BOJ will have responsibility for the micro-prudential supervision of not only DTIs – commercial banks, building societies, merchant bank and credit unions, but also non-bank financial institutions (NBFIs) – securities dealers, insurance companies and pension funds. This intended change in the country’s financial regulatory landscape was outlined in the Government of Jamaica’s policy statement made on Monday (January 23) by Minister of Finance and the Public Service Dr Nigel Clarke.
The BOJ said it was equipped with the personnel, technology and the supervisory systems at globally accepted and recognised standards to undertake its existing microprudential supervisory activities.
“The Central Bank is committed to strengthening its systems, upgrading the competencies of BOJ staff, as well as collaborating to synergise the appropriate technical skills at the FSC, to fulfill the Central Bank’s additional responsibilities for the fair, transparent, open and diligent regulation and supervision of all financial institutions to global standards as prescribed by law and government policy.”
The BOJ team will be working closely with the management and staff of the FSC to give effect to the transition that will include the transfer of responsibility for market conduct of DTIs to the FSC, which will also have added to its remit, financial consumer protection, in addition to retaining market conduct oversight for NBFIs. The two entities will also be cooperating to undertake the necessary assessment of the required amendments to the legislative, policy and institutional frameworks to give effect to the new government policy.
The BOJ noted that Byles and FSC Executive Director-designate Major Keron Burrell, who is being seconded from BOJ, met with FSC management and staff today (January 26) “to thank the FSC team members for their invaluable public service and to encourage them to continue giving of their best in the current period of transition and beyond”.
The BOJ said that, along with the FSC, it would be consulting with the requisite stakeholders in the public and private sectors to ensure the seamless and effective implementation of the responsibilities of the organisations.
The Central Bank noted that, as it tackles the processes required for the consolidation of prudential regulatory supervision of DTIs and NBFIs, the BOJ would be providing updates to the finance minister and other stakeholders, including the people of Jamaica and local and global investors.