Fri | Jun 2, 2023

BOJ preparing its systems to take on expanded oversight of financial sector

Published:Friday | January 27, 2023 | 8:49 AM
Governor and Chairman of the Bank of Jamaica and newly named Chairman of the Financial Services Commission, Richard Byles.

The Bank of Jamaica (BOJ) says it is preparing its operational systems and personnel to effectively transition to become the super regulator of the financial market.

The $3-billion alleged fraud that rocked dozens of investors, including retired Jamaican sprinter Usain Bolt, at Stocks & Securities Limited (SSL) has spurred the Government to announce sweeping reforms for the financial sector.

READ: BOJ to take over FSC's job

Finance and the Public Service Minister Dr Nigel Clarke announced on Monday that the Government will introduce reforms that will give the BOJ responsibility for the prudential supervision and regulation of deposit-taking financial institutions such as commercial banks, building societies, merchant banks, and credit unions.

The central bank will also supervise and regulate non-bank financial institutions comprising securities dealers, insurance companies, and pension funds.

That role is currently managed by the Financial Services Commission (FSC).

He said that a separate regulator for market conduct and consumer protection for the full spectrum of financial services will be established separately.

According to Clarke, the FSC will have a new mandate that involves consumer protection supervision for all financial service providers such as deposit-taking institutions, non-bank financial institutions, cambios, and remittance companies.

The changes are to take  18-24 months.

In a statement today, the central bank says this is equipped with the personnel, technology and supervisory systems at globally accepted and recognised standards to undertake its existing microprudential supervisory activities.

Further, it says that it 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 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 central bank said.

BOJ Governor, Richard Byles, who has been appointed Chairman of the FSC board, says the new board will be relying on the continued dedication and professionalism of the commission's management and staff in charting its future direction and implementing the tangible steps towards achieving the stated objectives of the government.

Byles and FSC Executive Director-Designate Major Keron Burrell, who is being seconded from BOJ, met with FSC management and staff on Thursday, 26 January 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 and the FSC will 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.

Byles and FSC Executive Director-Designate Major Keron Burrell, who is being seconded from BOJ, met with FSC management and staff on Thursday, 26 January 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.

Bank of Jamaica and the FSC will 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.

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