The Eastern Caribbean Central Bank said it is taking steps to introduce a Regional Standards Setting Body to regulate non-bank financial institutions within the Eastern Caribbean Currency Union (ECCU). This is in keeping with the ECCB’s mandate to ensure integrity within the banking system, a release from the ECCB states.

Speaking on this week’s episode of ECCB Connects, chief director (Policy) at the ECCB, D Tracy Polius, explained that a standards setting body is an institution that is established to set guidelines to regulate a particular industry or market. She added that non-bank financial institutions include credit unions, insurance companies and development banks, which are included in this reform.

Polius pointed out that the ECCB is also a regional standards setting body, as it functions as the regulatory body for commercial banks and licensed financial institutions within the ECCU.

She said that once established, the Regional Standards Setting Body for the non-bank financial sector will minimise the separation between regulation and supervision at the national and regional levels and will support the ECCB in the execution of its mandate.

Other benefits of such a body include reducing the cost of compliance for institutions, even application of regulations and guidelines to avoid regulatory arbitrage, and the promotion of a single financial space in the ECCU.

The next step in establishing the Regional Standards Setting Body is to consult with member countries and the various stakeholders to ensure that its design is fit for purpose

and that all aspects of the regulatory process are addressed.