Hosin on board with BOJ decision
Gayon Hosin is on board with the decision by her employer, Bank of Jamaica, which, this week, chose not to renew her contract, saying the recent acquisition of a stake in Guardian Holdings by National Commercial Bank Jamaica creates a conflict of interest in the execution of her duties.
Hosin, who headed the supervisory division for financial institutions, had her last day of duties in office on Tuesday, but she officially demits the central bank on August 19, bringing a 21-year career at BOJ to a close.
NCB struck a deal to acquire 29.99 per cent of Guardian Holdings Limited last November. The deal closed in May. Hosin's husband, Eric, heads the Kingston-based Guardian Life Limited, a subsidiary of GHL.
Asked whether BOJ might have overreacted, Hosin pushed back on the suggestion.
"I was a part of the discussion and I wouldn't agree that it's an overreaction," Hosin told the Financial Gleaner on Thursday.
"The fact is that under the supervisory provisions in the BSA (Banking Services Act), the acquisition has put NCB in a position where they will be actually participating in the direction of the Guardian Holdings Group," she said.
"And so, two things: One, when we are doing consolidated supervision they will be treated as part of the NCB Group. So in that regard my responsibilities will have a direct reach," Hosin said.
"Second, in the accounting profession it is not enough for there to be no conflict of interest. In fact, there must be no perception and both of them would arise in this case."
The central banker added that the potential for conflict arising was always recognised by the Hosins.
"As a matter of fact, I think we have been blessed that we have managed to make 21 years with both of us working in the financial sector and not encountering that. It has brushed at us before, but it has never come to conclusion like this," Hosin said.
The BOJ statement said that under the Banking Services Act, GHL now falls within the NCB Group, which is subject to the supervisory responsibilities normally assigned to Hosin in her capacity as deputy supervisor of banks.
Hosin was recused from decisions regarding NCB, but the central bank said it found the situation unworkable given NCB's place in the market as the largest bank by assets.
"However, given the systemic importance of the NCB Group, the permanent exclusion of Deputy Governor Hosin from the relevant supervisory processes would significantly diminish her ability to discharge the responsibilities of her office," said BOJ in a statement issued late Tuesday.
"Against this background, and in the absence of opportunities for reassignment and in the best interests of both parties, the decision was taken to ameliorate the conflict of interest by way of non-renewal of Mrs Hosin's current contract of employment."
Hosin's last contract at BOJ expired at the end of March.