St Kitts-Nevis financial secretary addresses de-risking banking issue
BASSETERRE - The threats to the region’s banking sector due to de-risking could have disastrous implications for the Caribbean region and as such Hilary Hazel, financial secretary in St Kitts, has shed some light on the issue as it pertains to the Federation during the prime minister’s monthly press conference on Monday.
The threat relates to the possible loss of access to international financial markets by mainly the regional indigenous banks. Several international banks, mainly in the US and Europe, have signaled to client banks in the region an unwillingness to continue carrying their business.
The so-called ‘de-risking’ by the global banks threatens to impact several critical services including remittance transfers. International trade and the facilitation of credit card settlements for local clients are among the other effects the region faces.
“St Kitts and Nevis is actually a part of the Caribbean Community (CARICOM) and the Caribbean Financial Action Task Force (CFATF) advances towards dealing with this critical problem that affects the region as a whole,” said the financial secretary. “We continue to be very robust in the interim in St Kitts and Nevis to have proper management of the financial services sector. We have continued to look at modernizing the laws, making sure that they are appropriate for our modern times and also to keep up-to-date with the changes as they affect the financial services sector.”
The financial secretary stated that the Federation’s active monitoring of licensed entities was also stepped up by the local regulatory body called the Financial Services Regulatory Commission (FSRC). She used the occasion to reach out to citizens and residents.
“I want to use this opportunity, however, that whilst we are waiting on the solutions that would be eventually devised at the regional level, every one of us here in St Kitts and Nevis has the opportunity to ensure that the general public cooperates with banks in terms of knowing their customer procedures,” she said. “We also have to be conscious of the fact that once we are engaged with the banks we have a duty to each other, to the banking system and to the health of our financial services system to ensure that whatever business engagement that we have that they are proper, that they are fit and that they do not expose our country to any allegations [and] to any proven facts that we have used international financial systems to assist terrorism and to assist with money laundering.”
Hazel advised all to pay attention to the present issue and to do all in their endeavour individually and collectively to ensure that the Federation maintains a very strong and robust financial services sector.
Prime minister of St Kitts and Nevis, Dr Timothy Harris, said that this is a work in progress and that the government has “galvanized a regional response of CARICOM coming together and attempting to do a single response to this challenge.”
Harris noted that the federal government held conversations with officials from the United States Treasury Department, as well as with other entities to gain a clearer understanding as it relates to their concerns and how best the government can provide a solution to the problem.