Aruba Banking Regulations and Laws Under Scrutiny: Supervisory Framework Explained

Introduction

Aruba’s banking regulator, the Central Bank of Aruba (CBA), has outlined its supervisory framework, highlighting the key laws and regulations that govern the financial sector. The CBA executes its oversight responsibilities in accordance with a range of sectoral supervisory laws and anti-money laundering/combating the financing of terrorism (AML/CFT) regulations.

Supervisory Framework

The CBA’s supervisory powers are derived from various State Ordinances, Decrees, and Regulations. These include:

• State Ordinance on the Supervision of the Credit System
• State Ordinance on Company Pension Funds
• State Ordinance on the Supervision of Insurance Business
• And other sectoral laws

AML/CFT Regulations

In addition to these sectoral laws, the CBA also relies on AML/CFT regulations to prevent and combat money laundering and terrorism financing. The State Ordinance on Prevention and Combating of Money Laundering and Terrorism Financing provides the legal framework for AML/CFT efforts in Aruba.

Supervisory Directives and Guidelines

The CBA issues supervisory directives and guidelines to ensure compliance with these laws and regulations by supervised entities. These directives provide:

• Mandatory rules
• Guidance on a range of topics, including:
  • Risk management
  • Capital adequacy
  • Liquidity requirements

Supervised entities are required to comply with these directives on an ongoing basis, providing the CBA with a solid legal basis for its supervisory tasks.

Commitment to International Regulatory Standards

The CBA is committed to keeping pace with changes in international regulatory standards, ensuring continued compliance with global best practices in financial sector supervision.

Conclusion

The CBA’s supervisory framework provides a robust foundation for maintaining stability and integrity in Aruba’s financial system, protecting consumers and investors alike.