ECCB 2020-2021 Annual Report and Statement of Accounts

AREAS OF FOCUS

• Continue to review, update and issue appropriate prudential standards aimed at minimising or eliminating regulatory risks; • Continue to engage in market sensitisation and training regarding Basel II/III implementation; and • Continue work in the areas of Community Outreach, Deposit Insurance, Eastern Caribbean Appraisal Institute and Shared Services Arrangement for national banks. The ECCB will work on strengthening the resilience of the financial sector to withstand shocks by advancing its efforts to establish a new risk management infrastructure that comprises a Credit Bureau. The drive to establish a Deposit Insurance Corporation will also continue with national consultations on the draft ECCU Deposit Insurance Bill towards finalisation and passage of the Bill. Work on the modernising of appraisal standards in the ECCU will be pursued in 2021/22 with the review of the prudential guidelines for valuation of collateral, review of legislation and the training of regulators in the valuation/appraisal standards and of appraisers/surveyors. The ECCB will continue to coordinate and facilitate the Shared Services initiative. The focus will be on the Detailed Design and Deploy and Sustain stages, and should be completed within the Financial Year 2021/2022. The Detailed Design stage will include the following: 1. Workshops to inform Service Level Agreements, design the detailed solution, and obtain feedback on the organisation design; 2. Development of change management plan; 3. Development of a communication plan and strategy; 4. Development of training plan; 5. Finalisation of Future State operational model The Deploy and Sustain stage will include the following: 1. Communication of transition process; 2. Delivery of change communication and assessment thereof; 3. Implementation of training plan; 4. Facilitation of knowledge sharing on re-designed processes Upon completion of this initial phase, the participants will consider extending the shared services arrangement to include other functions, such as, information technology, internal audit, and procurement. Money Laundering and Terrorist Financing are major international problems whose direct and indirect costs constitute a significant impediment to economic growth, particularly in economies with weak regulatory, supervisory and governance regimes. International standards on anti-money laundering (AML) and combating the financing of terrorism (CFT) promote financial integrity and support the fight against crime. However, the inappropriate implementation of these standards—especially in developing countries—plays a role in excluding millions of low-income people from formal financial services. It can undermine social and economic advancements and deny regulators and law enforcement a key means of strengthening financial integrity: the ability to trace the movement of money. It is against this backdrop that the Caribbean Development Bank (CDB), Global Affairs Canada and the ECCB have collaborated to give priority to the strengthening of the AML/CFT frameworks within the member states and to increase the technical capacity of financial institutions and regulatory authorities. The scope of this project entails: 1. Assess and understand the AML and CFT risks in the Eastern Caribbean; 2. Assess the effectiveness of the existing AML and CFT control and reporting system in the ECCU, particularly the asset freezing mechanisms, data collection practices and statistics on the proceeds of crimes and illicit financial flows; 3. Assess the gaps between the existing AML and CFT legal and regulatory framework and the requirements under the revised (2012) Financial Action Task Force recommendations; 4. Propose measures to improve the AML and CFT control and reporting systems;

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EASTERN CARIBBEAN CENTRAL BANK ANNUAL REPORT 2020/2021