Jamaica’s Government Unveils Plan for Banking Regulation Overhaul

The Jamaican government has announced plans to introduce a “twin peaks” regulatory model by 2025, with the Bank of Jamaica set to take over regulation of the non-bank sector. This move comes after a high-profile scandal at a Jamaican non-bank financial institution earlier this year.

Background

In January, Finance Minister Nigel Clarke made the announcement that the central bank would be taking on oversight of the non-bank sector following the scandal in November.

The “Twin Peaks” Model

The “twin peaks” model is designed to separate prudential supervision from market conduct regulation, allowing for a more effective and efficient regulatory system. This means that the Bank of Jamaica will now be responsible for regulating both banking and non-banking financial institutions, including:

• Securities firms
• Insurance companies
• Other financial entities

Benefits

The move is seen as a major step towards strengthening the country’s financial regulations and preventing similar scandals from occurring in the future. According to Wayne Robinson, senior deputy governor of the Bank of Jamaica, the new legislation will bring about a more robust regulatory framework for the country’s financial institutions.

Conclusion

The Jamaican government’s plan to introduce a “twin peaks” regulatory model is expected to have a significant impact on the country’s financial sector. With the central bank taking over regulation of the non-bank sector, the country can expect a more effective and efficient regulatory system, which will help to prevent similar scandals from occurring in the future.