Supervisory Capacity Building and Consumer Protection in Guyana
Project Development Objective (PDO)
The objective of this technical assistance program is to strengthen the capacity of the Bank of Guyana (BoG) to supervise financial institutions as well as to develop a framework for financial consumer protection.
The Bank of Guyana (BoG) is the country’s main supervisor of the financial sector, and the BoG currently supervises banks, non-bank financial institutions (NBFIs), insurance companies, and pension funds. The BoG’s responsibilities were recently enhanced to prevent supervisory blind spots; however, these responsibilities require the development of new supervisory tools and capacities. In this context, the FIRST (Financial Sector Reform and Strengthening) Initiative funded two successful projects from 2012 to 2014. Those projects focused on (a) assessing the NBFI sector and (b) developing an adequate regulatory framework for insurance and pensions. This current project is a direct follow-up to those engagements, as the BoG requested additional assistance to increase both supervisory capacity and consumer protection.
This project covers the following areas:
Component 1. Supervisory capacity building in banking, insurance, credit unions, and anti-money laundering
The project assistance will be to review the current stress-testing model used for banks and to
assist in the drafting of the revised model. The project team will also conduct a training seminar
with BoG staff on macroprudential supervision and systemically important financial institutions
(SIFIs). The team will provide recommendations as to how to improve the supervisory framework
Technical assistance in this area focuses on (a) developing a risk-based framework to ensure
adequate supervision of insurance companies, (b) reviewing and updating the insurance
supervision manual to align with the new legislation, (c) developing stress-testing models and
procedures, and (d) providing training on on-site and off-site supervision.
• Credit Unions
To enable adequate supervision of credit unions, the project team is currently (a) conducting a
qualitative review of the credit union sector, (b) developing an action plan of required
supervisory actions, and (c) providing support for an audit of the largest credit unions.
• Anti-Money Laundering (AML)
In regard to AML, the project team supports updating supervisory manuals for insurance
companies, foreign exchange companies, money transfer operators, and pension funds. The
project team also provides training on AML supervision.
Component 2. Developing the legal, regulatory, and institutional frameworks for financial consumer protection
The project team is conducting a diagnostic study to identify gaps. The team is also (a) making recommendations to develop appropriate legal, regulatory, and institutional frameworks; (b) developing an action plan; and (c) drafting financial consumer protection laws and regulations as required for all financial services, banks, and non-banks.
The main expected outcomes of the project are as follows:
1. Banking: Improving capacity to identify risks and supervise SIFIs and macroprudential policies
2. Insurance: Improving supervisory capacity of the risk-based supervision and new legislation
3. Credit unions: Integrating the supervision of credit unions under BoG
4. AML: Improving capacity to supervise AML in line with international standards (specifically, those
developed by the Caribbean Financial Action Task Force and the Financial Action Task Force)
5. Putting the financial consumer protection framework in place