ECCB 2022-2023 Annual Report and Financial Statements

Eastern Caribbean Central Bank Notes to the Financial Statements For the year ended 31 March 2023 (Expressed in Eastern Caribbean dollars)

3. Financial risk management (continued)

a) Introduction and overview (continued)

Risk Management Structure ( continued)

The Bank has also established internal committees and departments for managing and monitoring risks.

Executive Committee

The Executive Committee of the Bank has the responsibility to ensure that efficient and effective risk management mechanisms are in place. Key to the management of risk within the context of the reserve management function is the reserve management framework which embodies the Bank’s risk tolerance. Included in this framework are the Bank’s Investment Policy, Strategic Asset Allocation and investment guidelines which establish the parameters within which the reserve management function is executed. The Board approves the written policies for overall risk management as well as specific policies relating to the reserve management function. Additionally, the provision of banking services is governed by policy decisions of the Board.

Office of Corporate Strategy and Risk Management

The Office of Corporate Strategy and Risk Management (OCSRM) has responsibility for designing and implementing an Enterprise Risk Management Framework, development and monitoring of the Bank’s strategic plan and management of the Bank’s Business Continuity Management System (BCMS). The Office reports on risk matters, including the review of risk management and the controls environment, to the Executive Committee and the Board Audit and Risk Committee.

Internal Audit Department

The Internal Audit Department is responsible for providing independent assurance that the Bank’s risk management, internal control and governance processes are adequately designed and operating effectively. The Internal Audit Department discusses the results of all assessments with the Executive Committee, and reports its findings and recommendations to the Board Audit and Risk Committee. The Internal Audit Department also monitors the departments’ implementation of audit recommendations and reports progress to the Executive Committee and the BARC.

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