Here is the converted article in markdown format:

Banks and Non-Banks Fall Short in Governance and Conduct

A recent study has revealed that banks and non-bank financial institutions in [country/region] have significant gaps in their governance and conduct practices, according to a report published today.

Governance: A Major Concern

According to the report, governance of market conduct appears to be an area requiring improvement across the banking industry. Compliance with the Guideline did not appear to be treated as a matter requiring close oversight at the Board level. In fact, some non-banks did not assign a member of senior management responsibility for ensuring compliance with the Guideline.

Gap Analysis: A Key Area for Improvement

The study also found that non-banks scored weaker than banks in conducting a gap analysis to review their policies, procedures, and systems against the requirements of the Guideline. This suggests that non-banks may not be adequately assessing their compliance with the Guideline.

Recommendations for Improvement

To strengthen governance of licensees’ market conduct practices, the report recommends:

Licensees develop procedures for reporting on compliance with the Market Conduct Guideline to the Board.
Where a gap analysis has not been conducted, licensees are required to conduct one to determine compliance with the Guideline.
A member of senior management be assigned responsibility for ensuring compliance with the Guideline.

Key Findings

The report highlights several key findings, including:

25% of banks did not reference the Guideline in staff training (particularly frontline staff).
Only 19% of non-banks maintained professional indemnity (errors and omissions) insurance.
Several non-banks did not conduct vulnerability assessments or have a documented process in place.

Conclusion

The report concludes that while there has been progress in adopting and operationalizing the Guideline, there is still much work to be done to ensure that licensees are fully compliant. The recommendations outlined in this report aim to address these gaps and promote good governance and conduct practices among banks and non-bank financial institutions.

Full Report Available

The full report can be accessed on our website.