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Ministry of Finance and the Public Service Fiscal Policy Paper 2017 77 | P a g e

financial products and services, which would enable them to save, invest and build economic wealth. The FIS">NFIS will focus on the following priority areas: MSME and agriculture finance, housing finance, consumer protection and financial literacy, and retail payment systems.

Enhancement of the Resolution Framework for Financial Institutions Preliminary work commenced with the drafting of a concept paper proposing a special resolution regime (SRR) for financial institutions. This concept paper will inform the drafting of a consultation paper, which is expected to be released for public feedback by end February 2017. An inter-agency technical working group of the Financial Regulatory Committee is drafting the papers, with technical assistance from the International Monetary Fund.

The proposed SRR for financial institutions will provide a framework for the orderly resolution of distressed financial institutions in order to protect financial stability whilst minimizing recourse to public funds. The proposed SRR is in keeping with international best practices promoted by the Financial Stability Board in its guidance document “Key Attributes of Effective Resolution Regimes for Financial Institutions”.

Financial Institutions Services Limited

During FY 2016/17, the FIS continued with the winding up of residual activities on behalf of FINSAC including selling remaining properties under its control. The following are some of its key achievements:-

 The audited financial statements for the year ended March 2016 for FIS and FINSAC were completed and submitted to the MOFPS in July 2016.

 The FIS sold the remaining 10 of the 31 Enchanted Gardens units, which netted $8.2mn. In addition, an agreement has been reached to sell the Mutual Life Warehouse Complex in Kingston which is expected to conclude by May 2017. The remaining properties in FINSAC’s portfolio are four ½ acre lots at Drax Hall, St. Ann and a 16-acre lot at Culloden, Westmoreland.

 A total of $48.0mn was collected from the sale of shares in various listed companies and another $12.0mn is anticipated from remaining sales by March 2017. Listed shares for dissolved companies will be transferred to the Accountant General by March 2017.

 The FIS has received seven (7) payments totalling US$3.4mn as at October 2016 under a settlement reached in 2013 regarding a property in St. Lucia which was owned by International Hotels (St. Lucia) Limited. There are three (3) remaining payments due in April 2017, October 2017 and April 2018, totalling US$1.3mn.

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Page 181

Public Bodies Ministry of Finance and the Public Service (Other) Corporation">Jamaica Deposit Insurance Corporation _____________________________________________________________________________________________

Public Bodies, FY 2019/20 Page 177 Ministry of Finance and the Public Service

Corporation">Jamaica Deposit Insurance Corporation Introduction The Corporation">Jamaica Deposit Insurance Corporation (JDIC) was established in accordance with the Deposit Insurance Act (DIA), 1998 and commenced operations on 31st August 1998. The Corporation is one of the Financial System Safety Net (FSSN) Partners and its mandate is to manage a scheme to provide insurance against the loss of deposits held in insured financial institutions, up to a maximum of $600,000 per depositor in each institution. Additionally, JDIC makes enquiries of policyholders in respect of the conduct of their financial affairs and acts as receiver, liquidator or judicial manager of any insolvent policyholder, or of its holding company or subscriber which becomes insolvent. Operational and Financial Overview The core operations of the Corporation are regulatory in nature consistent with the DIA. Operationally, the JDIC is expected to achieve its mandate of managing a scheme to provide insurance against the loss of deposits held in insured financial institutions through the following:-

Proactive Readiness and Resolution Management - the Corporation continues to have a critical role in contributing to financial system soundness and stability. Accordingly, JDIC will maintain its operations in a state of readiness in order to meet its primary mandate. To support its readiness, JDIC will continue the development and implementation of a Special Resolution Regime (SRR) for the resolution of non-viable financial institutions which was approved in October 2017. JDIC will also continue to update the risk assessment framework and guidelines for recordkeeping for policyholders.

Strong Partnerships - the Corporation will continue to build strategic partnerships with key stakeholders including policyholders, FSSN partners and regional and multilateral institutions. This provides for cooperation and information sharing on the regulation of financial institutions and cross border supervision and resolution.

Public Education and Awareness - public awareness is one of the International Association of the Deposit Insurers’ Core Principles for Effective Deposit Insurance Systems. JDIC will continue its public education programmes which are key to maintaining depositor confidence and financial system stability.

Leveraging Information and Communication Technology for Operational Efficiency -

Strategies for strengthening JDIC’s operational efficiencies are ongoing. As a result, the Corporation will undertake a review of its strategy in order to strengthen operational efficiency in the context of the increasing use of information technology for data management and protection. The key initiative that will characterize this strategy is the development of formal information, communication and technology governance plan with the appropriate policies, practices and procedures.

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Page 18

18 INTER-AMERICAN DEVELOPMENT BANK

(iii) all funds m i v e d in payment of loans made from the resources mentioned above;

(iv) all income derived from operations using or commit- ting any of the resources mentioned above; and

(v) any other resources at the disposal of the Fund

SECXION 44perai ionr (a) The operations of the Fund shall be those 6nanced from its

own resources, as defined in Section 3 (h) of the present article. (b) Loans made with resources of the Fund may bc partially or

wholly repayable in the currency of the member in whose temtory the project being financed will be carried out. The part of the loan not repayable in the currency of the member shall be paid in the currency or currencies in which the loan was made.

SECT:ON 5-Limitation on Liability In the operations of the Fund, the financial liability of the Bank

shall be limited to the resources and reserves of the Fund, and the liability of members shall be limited to the unpaid portion of their respmtive quotas that has become due and payable. SECTION &Limitation on Disposition of Quotas

The rights of members of ,the Bank resulting from their contributions to the Fund may not be transferred or ensumbered, and members shall have no right of reimbursement of such contributions except in cases of loss of the status of membership or of termination of the operation of the Fund. SECTION 7-DiFchorge of Fund Liubilities on Borrowings

inclusion in the resources of the Fund shall be charged: Payments in satisfaction of any liability on borrowing of funds for

(i) first, against any reserve established for this purpose: and

(ii) then, against any other funds available in the resources of the Fund.

SECTION 8-A dminisrrulion

(a) Subject to the provisions of this Agreement, the authorities of the Bank shall have full powers to administer the Fund.

(b) There shall be a Vice President of the Bank in charge of the Fund. The Vice President shall participate in the meetings of the Board of Executive Directors of the Bank, without vote, whenever matters relating to the Fund are discussed.

In the operations of the Fund the Bank shall utilize to the fullest extent pxsihle the same personnel, experts, installations, offices. equipment, and services as it uses for its other operations.

(E)

me inclusion of this page is authorized by L.N. 68/1978

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Page 54

Ministry of Finance and the Public Service Fiscal Policy Paper Interim Report September 2017 52 | P a g e

products and services, which would enable them to save, invest and build economic wealth. The focus of the NFIS will be on the following priority areas: MSME and agriculture finance, housing finance, consumer protection and financial literacy and retail payment system.

Proposal for the enhancement of the Resolution Framework for Financial Institutions

The Consultation Paper proposing a special resolution regime (SRR) for financial institutions was completed by the inter-agency technical working group of the Financial Regulatory Committee with the technical assistance of the International Monetary Fund. The Consultation Paper was subsequently released for public feedback on February 28, 2017 and the resulting feedback was taken into consideration in drafting the Cabinet Submission. The Cabinet Submission was forwarded to the Cabinet in July 2017 for its approval of the policy proposal. The next step is to prepare and issue drafting instructions to the CPC to draft the relevant Bill.

The proposed special resolution regime for financial institutions will provide a framework for the orderly resolution of distressed financial institutions in order to protect financial stability whilst minimizing the recourse to public funds. The proposed SRR legislation will be in keeping with international best practices promoted by the Financial Stability Board in its guidance document “Key Attributes of Effective Resolution Regimes for Financial Institutions”.

Proposed Credit Union (Special Provisions) Act

The Cabinet Submission was prepared and submitted to the Cabinet in April 2017 for its approval of the proposal for the enactment of legislation to facilitate the supervision of credit unions by the Bank of Jamaica. The Cabinet approved the Policy in May 2017. Subsequently, drafting instructions were prepared and submitted to the CPC. The FRD received a preliminary draft of the Bill in July 2017.

Financial Sector Adjustment Company Ltd and Financial Institutions Services Ltd

During the review period, FINSAC Limited continued with the winding up of residual activities including selling remaining properties under its control. The following are some of its key achievements:-

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June 12, 2021


Page 79

Ministry of Finance and the Public Service Fiscal Policy Paper 2019 Page 77

Proposal for the enhancement of the Resolution Framework for Financial Institutions

The preparation of the legislation for the Special Resolution Regime (SRR) for financial institutions (FIs) comprises three (3) work streams, which are currently at different stages of progress. These streams are the administrative component (ARR), the Funding component, and the specialized modified insolvency framework (SIF) component. The latter component falls under the purview of the Ministry of Industry, Commerce, Agriculture and Fisheries (MICAF). Both the SIF and Funding components are critical elements of the SRR and will merge with the ARR component once Cabinet’s approval is received for each policy. With respect to the ARR, which addresses systemically important financial institutions (SIFIs), drafting instructions were sent to the CPC in April 2018. A working/preliminary draft of the Bill was received from the CPC in August 2018, and was reviewed by a technical working group led by the BOJ. Subsequently, further drafting instructions were issued to the CPC to revise the Bill in November 2018. The proposed legislation for the SRR for FIs is intended to enhance the resilience and stability of the financial system in Jamaica, by providing a framework to address the resolution of non-viable financial institutions in a way that minimizes the resort to public funds, whilst preserving vital economic functions.

National Financial Inclusion Strategy (NFIS)

Since the establishment of the National Financial Inclusion Council (NFIC) and the subsequent launch of the National Financial Inclusion Strategy (NFIS) in 2017, the working groups under the Financial Inclusion Steering Committee (FISC) have been meeting and working on the implementation of the action plans contained in the NFIS. The Bank of Jamaica and the Financial Inclusion Technical Secretariat hosted the NFIC Meeting in July 2018, where the Annual Report was tabled. At the meeting, an animated piece and play were staged to promote greater understanding of financial inclusion and the NFIS Brand Ambassadors were also introduced.

Financial Investigations Division (FID)

During the review period, the FID continued to pursue its mandate under the Financial Investigations Division Act and the Proceeds of Crimes Act (POCA) to take the profit out of crime. Some notable achievements of the FID include:

Preparations for conversion from a Division of Government to a Department. A Consultant was retained in December 2018 to assist in transforming the FID into a Department.

Caribbean Financial Action Task Force (CFATF). In November 2018, Hon. Minister Fayval Williams, (Minister without Portfolio in the MOFPS) became the Head of Jamaica’s delegation to CFATF. She has been authorized to drive the key reforms to Jamaica’s Anti- Money Laundering and Countering the Financing of Terrorism framework (AML/CFT), which is necessary to address key technical deficiencies and priority actions identified in the Mutual Evaluation Report of Jamaica issued by the CFATF. Addressing these issues is critical to avoid

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June 12, 2021


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