BASSETERRE, ST. KITTS, APRIL 27th, 2016 (PRESS SEC) – The Eastern Caribbean Asset Management Corporation Bill, 2016, which had its first reading on March 23rd, 2016, was passed today in the National Assembly.
Prime Minister Dr. the Honourable Timothy Harris, in his capacity as Minister of Finance, moved its second reading in Parliament today.
At the 81st meeting of the Monetary Council of the Eastern Caribbean Central Bank (ECCB) on February 24th, 2015, the Council agreed that legislative and regulatory reforms were needed to protect the Eastern Caribbean Currency Union (ECCU) banking sector.
The Banking Act, No. 1 of 2015, which was passed in the Parliament last July, is a corollary of that ECCB Monetary Council meeting. So, too, is the Eastern Caribbean Asset Management Corporation Act, 2016.
The Act gives legal effect to the February 2015 agreement establishing the Eastern Caribbean Asset Management Corporation.
The stated purpose of the Eastern Caribbean Asset Management Corporation is to “(a) carry on the business of asset management including acquiring the whole or any part of, dealing with, managing, and disposing of assets or liabilities of approved financial institutions in an expeditious manner and (b) act as the receiver of a financial institution whenever appointed by the Central Bank under the Eastern Caribbean Central Bank Agreement or the Banking Act.”
The ECCB Monetary Council on February 24th, 2015 agreed to introduce amendments to the aforementioned Eastern Caribbean Central Bank Agreement as part of a comprehensive and integrated strategy, in addition to proposing the implementation of the Banking Bill and the Eastern Caribbean Asset Management Corporation Agreement and Bill.
“The member states of the ECCU agreed to arrange for the enactment of the relevant legislation that would support the Bank Resolution Strategy aimed at strengthening the resilience of the financial system in the Currency Union,” the Honourable Prime Minister said, adding that, “Member Governments, including the Government of St. Kitts and Nevis, are also committed to ensuring that the legal framework for addressing challenged banks is implemented in all member states in a timely manner. Mr. Speaker, it is for this reason that my Government is proposing the enactment of the Eastern Caribbean Asset Management Corporation Bill, which is intended to ensure that the ECCB is placed in a position to be better able to respond appropriately when situations arise and thereby improve the integrity and stability of our financial system.”
The Monetary Council, acting on the recommendation of the Central Bank, will determine approved financial institutions based on certain criteria, including being licensed under the Banking Act. The list of approved financial institutions shall be published by notice in the official Gazette in each member territory.