KINGSTOWN, St. Vincent – The parliamentary opposition has restated is objections to sections of a bill passed here this week although it says it agrees with the intention of the legislation.
Opposition Leader Arnhim Eustace told Parliament that he had no difficulty with the substance of the Financial Services Authority Bill and understood what it was intended to achieve.
He said that in light of the financial challenges facing the world, legislation such as this one was needed to really strengthen the regulation and supervision of non-banking financial institutions such as insurance companies, credit unions, and co-operatives, according to a press statement from the New Democratic Party (NDP).
Eustace, however, indicated that the fundamental proposal being made under the Act was for all non-banking financial institutions, including all the institutions now being regulated by the International Financial Services Authority (IFSA) — offshore financing — to be regulated by the Financial Services Authority (FSA).
“The FSA would be responsible for regulating hundreds of IBCs, trusts, mutual funds and other similar institutions in the offshore sector, along with other growing non-bank financial institutions like credit unions, including the St. Vincent Building and Loan Association,” said the press statement which was issued after the legislation was passed.
Eustace, the opposition spokesperson on financial matters, believed that the workload was too much for one institution to do effectively at this time, given the problems with recruiting the necessary technical and other staff.
He suggested that the IFSA continue to regulate offshore institutions and the other services they presently regulate, that the Eastern Caribbean Central Bank continue to regulate commercial banks, and that the FSA should start with regulating only the other non-banking financial institutions not covered by IFSA,.
Opposition Members of Parliament St. Clair Leacock and Daniel Cummings supported this position, with Leacock suggesting that merging IFSA and the FSA could be done in subsequent years.
“Despite the strenuous observations made by the opposition the Bill was passed without amendment,” the NDP said