Eastern Caribbean Central Bank 2024-2025 Annual Report

EASTERN CARIBBEAN CENTRAL BANK ANNUAL REPORT 2024 - 2025

Financial Stability

to ensure adequate provisioning for impaired facilities. The Bank stepped up its monitoring in this regard, given that 2024 marked the end of the transition period towards the 100.0 per cent provisioning for loans classified as ‘loss’. In keepingwith itsmandate to protect the interest of depositors and creditors, the ECCB commissioned an independent audit of Republic Bank (EC) Limited,

Republic Bank (Anguilla) Limited and Republic Bank (Grenada) Limited, following concerns resulting from delayed e-commerce and point of-sale transactions. Effective 6 January 2025, pursuant to its powers under Part IX Section 114 of the Banking Act, 2015 of Saint Lucia (No 3 of 2015), the ECCB appointed an Official Administrator for Financial Investment and Consultancy Services Limited, Saint Lucia.

Basel II/III Framework The ECCB attained the following critical milestones through its phased approach in the implementation of its Basel II/III capital framework. Implementation of Phase I/Pillar 1: Phase I corresponds with Pillar 1 of Basel II/III- Minimum Capital Requirements 01 Following its integration of the new Basel II/III prudential return 16 (PR16) into the existing prudential reporting framework, the ECCB commenced ‘go live’ reporting in July 2024, thus completing the implementation of Phase I. By December 2025, the ECCB will conduct targeted reviews at selected LFIs, to ensure compliance with Pillar 1 requirements. The ECCB is simultaneously implementing Pillar 2 (Phase II) of its framework. ImplementationofPhase II/Pillar2:Phase II correspondswithPillar2of the implementation roadmap - Supervisory Review and Evaluation Process 02 Work continued towards the finalisation of the framework for the ECCB’s Supervisory Review and Evaluation Process for Pillar 2 activities. The review of the Internal Capital Adequacy Assessment Process (ICAAP) is ongoing. Given unforeseen delays with some banks’ submission of the ICAAP, the ECCB expects to implement Phase II by quarter four of 2025. Implementation of Phase III/Pillar 3: Phase III corresponds with Pillar 3 -Market Discipline, which is dependent on information from Pillars 1 and 2 03 The ECCB aims to finalise the framework to complete Phase III of its Basel II/III implementation roadmap in 2026. Through continuous collaborative assessments and industry consultations, the ECCB will remain flexible in implementing necessary capital and liquidity measures.

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