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ECCB ANNUAL REPORT 2016/2017
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the development of a vision for large value
payments in the ECCU;
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the review of licensing regimes under the
Money Services Business Act; and
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the adoption of the CPSS-IOSCO Principles for
Financial Market Infrastructure.
As part of the governance framework for the Payment
System, appropriate legislation has been passed in
the ECCB member countries. However, the Rules,
Regulations and Guidelines to support the primary
legislation have not yet been completed. The Bank
established an Internal Working Group to develop
Guidelines for Electronic Retail Payment Services in
the upcoming year.
Technology is continuing to play a critical role in the
development of the Payment System. In order to
ensure that the ECCU financial sector does not lag
in the financial technology revolution, the Bank has
been paying serious attention to the developments
in blockchain technologies and digital currencies
and is currently considering a proposal on a digital
currency pilot. The proposal, if accepted, would take
the form of a “proof of concept” experiment, using a
phased approach within controlled environments to
deploy, test and assess the feasibility of an EC digital
currency. The Bank has also embarked on an initiative
geared at developing a cadre of professionals through
the development of a Working Group, conversant in
the issues relating to digital currency and financial
technology. This group is intended to create awareness
throughout the currency union and ascertain the
risks involved in the use of digital currency and other
payment options emanating from the developments in
technology.
REGIONAL GOVERNMENT SECURITIES
MARKET (RGSM)
The Regional Government Securities Market (RGSM)
continued to provide an avenue for commercial
banks and other financial institutions to invest the
high level of liquid funds in the banking system.
Financial institutions accounted for at least 60.0 per
cent of the total bids during the current financial
year. The banks remained the single largest group
of investors on the RGSM, accounting for roughly
40.0 per cent of the bids. In its presentation on
the RGSM at the OECS Credit Union Summit in
St Vincent and the Grenadines in September 2016, the
ECCB sought to increase the awareness of this sector.
Activity on the secondary market increased during the
financial year as the number of trades inceased to 25
from 14 in the preceding year.
COMMERCIAL BANKS’ PRUDENTIAL RETURNS
Steps to revise the prudential returns progressed with
the incorporation of changes to the Banking Act and
the capturing of the IFRS 9 standard and impaired
assets guidelines. The Manual of Instructions was
also updated. The financial institutions registry was
updated in collaboration with regulators in the ECCB
member countries to capture new institutions and to
remove those that had been closed.
LEGISLATIVE AGENDA
During the year, the Bank continued to focus its efforts
on the implementation of the Legislative Reform
Programme aimed at enhancing the resilience of the
financial sector of the ECCU, and the advancement of
the single financial and economic space. The Bank has
made considerable headway on the following pieces
of legislation: