Saturday, 28 July 2012 02:30
By caribarena news
Antigua St. John's - Minister of Education, Sports, Youth & Gender Affairs Dr. Jaqui Quinn-Leandro on Friday led the passage of the Banking Amendment Act 2012 through the lower house.
The amendment seeks to bring Antigua & Barbuda’s banking industry into line with regional and international norms by giving the Eastern Caribbean Central Bank (ECCB) regulatory powers over appointments of directors and changes in major shareholders.
The two-line amendment is considered “very straightforward” with a small modification to the Banking Act of 2005.The amendment was to be piloted by Finance Minister Hon. Harold Lovell, who did not appear in Parliament on Friday.
“The bill is amending the Banking Act so that the local financial institutions are required to inform the ECCB, as the regulatory authority, of any change in directors, significant shareholders and senior management staff within the institutions,” Dr. Quinn-Leandro said.
She added that the bill enables the ECCB to recommend such measures that it believes applicable with respect to the appointment of individuals it believes do not meet the criteria set out in the Act. Section 26 of the Act is under particular reference.
“The rationale for making this amendment and having this information shared with the ECCB dates back to 2008,” Dr. Quinn Leandro said. In 2008, an assessment on Antigua’s banking industry was conducted and it was determined that this issue was among several shortfalls that needed redress.
“What we are doing here today is as a result of the evaluation report. We are now (four years later) becoming compliant and simply amending this act so that the ECCB would have the power to approve changes in directors and shareholders,” Dr. Quinn-Leandro said.
St. Philips North Member of Parliament Robin Yearwood said that although he supported the amendment he needed clarification on whether or not the amendment would apply to offshore banks. He said this was a necessary clarification, considering that the nation could not afford to be tied up in court proceedings if its offshore sector is not properly regulated. And as such, measures must be put in place today.
Opposition Leader Lester Bird recommended that a whitepaper be prepared on the matter of offshore banking regulations for discussion and advice. This measure would serve to ensure that the integrity of Antigua’s system is protected while allowing others to come and have a look inside.
Attorney General Justin Simon said the amendment only applies to local banks, which fall under authority of the ECCB.
Regarding the offshore banks, he said the FSRC has the supervisory and regulatory authority and the amendment of today has long been intertwined into the rules of the FSRC. It has also been implemented into the corporative Society Act.
“The final hurdle is that of the local banking administration. Much has been made of the fact that we have taken some time before introducing this to the Honourable House, but we cannot overlook that what is being done here must also be done in the other OECS territories, since the country’s Banking Act mirrors those of the other countries,” the AG said.
Simon added that Antigua & Barbuda must come up to scratch with its local regulations, since most of its banks are connected to international chains that could sever ties with the local branches if proper regulations are not in place.
Contributions to the amendment were made by St. Mary’s North MP Molwyn Joseph, Barbuda MP Trevor Walker and All Saints West MP Chanlah Codington, before the bill passed through committee stage with minor amendments.