By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Central Bank has warned licensees that it has seen “a significant incidence of repeat findings”, where issues identified by regulators in on-site examinations have not been resolved despite assurances to the contrary.

Abhilash Bhachech, the Central Bank’s inspector of banks and trust companies, warned licensees in an April 21, 2017, letter that the regulator may impose fines should it find “material repeat findings” in on-site examinations.

“In the course of our on-site examinations, we assess the completeness and effectiveness of [a] licensee’s resolution measures in addressing our supervisory findings,” Mr Bhachech wrote.

“In this context, we note a significant incidence of repeat findings on matters that have not been satisfactorily resolved, contrary to what was reported to the Central Bank in some responses to the Reports of Examination.

“Licensees must ensure accurate reporting of resolution measures pertinent to examination findings. In the event that our on-site examination identifies material repeat findings, the Central Bank may impose monetary penalties for the deficiencies.”

Elsewhere, Mr Bhachech noted that the Central Bank and other financial services regulators, together with the Ministry of Finance and Attorney General’s Office, were preparing for the third and latest round of the Organisation for Economic Co-Operation and Development’s (OECD) Global Forum Peer review.

This will occur in July, and will assess the Bahamas’ compliance and co-operation with global standards on tax transparency and the exchange of tax information.

Mr Bhachech noted that the implementation, and roll-out, of the OECD’s Common Reporting Standard (CRS) for the automatic exchange of tax information, was one of “the most prominent” challenges facing the industry.

“Externally generated challenges to the industry remain, one of the most prominent being the uncertainty underlying the global rollout and impact of the OECD’s Common Reporting Standards (CRS) on tax cooperation,” he wrote.

“From a financial performance perspective, banking assets continued to grow, whereas the revenue margins remain stressed due to competitive pressures, emergence of low-cost business models and market volatility.

“As a result, our licensees continue to seek operational efficiencies through cost reduction, outsourcing, standardisation, shared services and value-added automation.”

Mr Bhachech said the Central Bank also planned to enhance its cyber-security supervisory regime, given the significant focus this was receiving in risk mitigation by banks.

“Given the focus on increased digitisation of operations, and management of client data, transaction monitoring, analytics and reporting requirements, the data integrity and prevention of internal and external cyberattacks are major imperatives going forward,” Mr Bhachech said.