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Suriname’s Regulatory Requirements for Financial Institutions: A Review
The Central Bank of Suriname (CBoS) plays a crucial role in overseeing the country’s financial sector, including banks, insurance companies, credit unions, pension funds, money exchange offices, and money transfer offices. This article will explore the regulatory requirements for financial institutions in Suriname.
Supervision of Banking and Credit System
Under the Bank Act 1956, the CBoS is responsible for supervising the banking and credit system, as well as currency exchange operations and transfers of financial resources to and from other countries. The Supervision of the Banking and Credit System Act 2011 replaced the earlier Act on the Supervision of the Banking and Credit System 1968 and incorporates the Basel Core Principles.
Key Features of the New Legislation
- A new licensing system
- Fit and proper test for management and shareholders
- Deposit insurance
- Administrative penalties
- Provisions for instructing authorized organs to follow a particular line of conduct
In cases where a credit institution is affected by a development that requires special measures, the CBoS can request the Subdistrict Court to declare emergency regulations.
Supervision of Money Transaction Offices
The Supervision Money Transaction Offices Act 2012 came into effect in October 2012, tasking the CBoS with supervising money exchange offices and money transfer companies. The Bank is responsible for issuing guidelines for the implementation of this Act, which includes requirements for:
- Directors
- Managers
- Holders of qualified holdings
Anti-Money Laundering and Combating of Terrorist Financing Directive
The Central Bank has also drafted an Act on the supervision of Capital Markets, expected to be presented to Parliament this year. Additionally, the Anti-Money Laundering and Combating of Terrorist Financing Directive 2012 was issued in April, covering AML/CTF supervision.
Progress and Review
Suriname has made significant progress in meeting the recommendations of the Caribbean Financial Action Task Force (CFATF), including the promulgation of legislation on terrorism and terrorist financing. The country is also reviewing its State Decree Indicators Unusual Transactions regarding transaction amounts for financial institutions and designated non-financial businesses and professionals.
Onsite Examination and Review
The CBoS has conducted an AML/CTF onsite examination at one commercial bank, with technical assistance provided by the U.S. Department of the Treasury. Meanwhile, the Supervision Department (Banking Section) is reviewing its State Decree Indicators Unusual Transactions regarding transaction amounts for financial institutions and designated non-financial businesses and professionals.
Insurance Corporations and Pension Funds
The CBoS is responsible for the prudential supervision of insurance corporations and pension funds. A new Act on Insurance Companies has been drafted and is expected to come into force by the end of this year, while amendments to the Pension and Provident Fund Act 2005 are being contemplated to strengthen supervision of pension funds.
Conclusion
Suriname’s regulatory requirements for financial institutions are designed to ensure stability and security in the country’s financial sector. The Central Bank plays a vital role in overseeing the sector and ensuring compliance with international standards and best practices.