Programmes Across All Sectors Consistent with International Standards
In order to ensure effective oversight, programs across all sectors are consistently reviewed and enhanced as deemed necessary to meet international standards.
Supervisory Actions
The Bermuda Monetary Authority (BMA) takes specific actions based on the results of its assessments to ensure firms operate within regulatory requirements. This may involve employing enhanced oversight or requiring changes to operations.
Sectoral Risk-Based Supervisory Processes
To assess risk in the banking, trust, corporate services providers and investment sectors, a six-step program is used:
- Identifying risk impact groups and prioritization
- Fundamental monitoring
- Application of the risk model
- Planning
- Enhanced monitoring
- Reporting and risk mitigation
Risk Assessment Model
The BMA uses CAMELBCOM, a risk assessment model that evaluates nine risk factors, including:
- Capital
- Assets
- Market risk
- Earnings
- Liabilities
- Business
- Internal Controls
- Organisation
- Management risk
Insurance Sector Supervision
The Authority has established a risk-based program for insurance sector supervision, comprising nine phases:
- Planning and prioritization
- Risk impact group
- Fundamental monitoring
- Prudential visits
- Enhanced monitoring
- Composite risk rating
- Supervisory attention ranking
- Supervisory actions
- Follow-up
Off-Site Monitoring
The Authority performs a base level of off-site monitoring, including:
- Annual reviews of statutory returns
- Ongoing assessments of publicly available information
Prudential Visits
Visits may be initiated by the Authority or the company to establish or maintain relationships with key management.
Enhanced Monitoring
This process includes both off-site and on-site work, reviewing public documents and non-public information, as well as conducting interviews and tests at the insurer’s offices.
Composite Risk Rating
The Authority summarizes all data gathered to form a composite risk rating applicable to the company.
Supervisory Attention Ranking
The nature and extent of regulatory action required is determined by this ranking, which originates from the Composite Risk Rating or other information brought to the BMA’s attention.
Reports and Follow-Up
Reports are prepared and reviewed within the Authority addressing concerns and issues that may warrant corrective action. The Authority ensures all necessary actions have been taken to complete the risk-based review of the subject company.
By consistently reviewing and enhancing programs across all sectors, the Bermuda Monetary Authority demonstrates its commitment to effective oversight and compliance with international standards.