President Anthony Carmona says it is time for the Central Bank to take an additional look at legislative reform targeted at the very banks over which it is statutorily required to regulate. He said as it stands, banks are viewed as corporate entities that stifle the fiscal capacity of the man on the street. And if the CBTT is promoting financial inclusion, then it must consider including the legislative reform necessary for fair and equitable dealings between bank and customer as they relate particularly to credit cards.
The President said so while praising the work of the Central Bank as the watchdog of this country’s economy, monetary policy and financial systems over the past five decades. The President was delivering the feature address at the 50th anniversary of the Central Bank on Saturday when he made the statement. It took place at the Hyatt Regency.
He said the bank’s staff, past and current, ought to be proud of these contributions which have included expanding the network of commercial bank branches, the establishment of the Stock Exchange, Unit Trust Corporation and the Deposit Insurance Corporation among other necessary institutions.
He noted the bank's drive for legislative reform focused on the strengthening of financial supervision and infrastructure such as the electronic payment system, the creation of the Financial Ombudsman’s Office and the implementation of a monetary policy framework based on the use of the Repurchase (Repo) Rate. And more recently, its launch of the Financial Inclusion Development Agency (FIDA) which aims at taking a more structured approach at legislative reform.
But Carmona was also quick to point out that the bank's progress had not come without challenges. Elaborating on legislative reform, he highlighted the misfortunes of a few financial institutions.
"We all remember painfully, the crash and burn of the financial institutions and trust and mortgage companies in the mid-1980s, the reverberating collapse of the Hindu Credit Union in 2008 and six months later, the trauma and haemorrhage to our country’s financial, reputational and psychological well-being that was, and today remains, the Clico fiasco," he said.
He said it was time for the Central Bank to take an additional look at legislative reform targeted at the very banks over which it is statutorily required to regulate. "The fact that bank charges and interest rates are so exorbitant needs to be examined by the Central Bank in the context of creating a sense of parity and fairness between bank and customer.”
He also commended the Central Bank for its forward-thinking in the signing of the recent Memorandum of Understanding between the bank, the Financial Intelligence Unit and the Securities and Exchange Commission to exchange information regarding suspicious illegal activities, as a certain step in the right direction.
"As the country’s watchdog in respect of the financing of illegal activities, the role of the Central Bank is clear and must be uncompromising. It must ensure that all financial institutions are compliant. If they are not, the sanctions in the implemented legislation must be enforced,” he said.
Parliament closes tomorrow
The Parliamentary agenda for the year closes off with tomorrow’s Senate debate of the Public Procurement Bill which was recently passed in the House of Representatives. The Lower House went on a break from the week before, to a date to be fixed. This is expected to be in early January.
Meanwhile the Senate’s focus tomorrow is completion of the Procurement Bill which was passed in the Lower House recently without amendments. The bill now has to return to the Senate to be approved there. The sitting begins at 11 am.