Number 983 • Friday, August 30, 2013

New Regulations Could Sink OECS Credit Union
By Lk Hewlett
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Credit Unions across the OECS are facing a new and very real threat to their existence- new regulations.
This is according to Andy Liburd, President of the St. Kitts and Nevis National Cooperative League and Nevis Co-operative Credit Union Limited. Liburd disclosed the perilous situation the institutions were facing during an address at last week’s Eleventh Annual OECS Credit Union Summit held in St. Kitts.
One of the key topics discussed at the summit was “Compliance:  Co-operatives Societies Act, Co-operatives Societies Regulations and Statutory Reporting”. Liburd is of the opinion that new regulations being proposed for credit unions could wipe out the region’s existing credit union sector.
“We are now faced with new regulations, new acts, new laws, new standards. They are all coming down on us and all at the same time.
“…If enacted in their present form, will surely wipe us out from the world of business,” Liburd warned, pointing out that some of these new regulations were in conflict with existing local legislation governing the industry.
He said regulations were nothing new to credit unions however the impact of the ones to be enacted were of a different ilk. Liburd did not go into specifics with regard the nature of the new laws but said coupled with the challenges brought on by the global financial meltdown, the situation would become extremely precarious.
“The credit union has always been regulated, we are not afraid of regulations; in fact it is our very bi-laws and our motto “People Helping People”, the very principles on which we were founded why we are still standing strong today.
“We are faced with very serious challenges today. The world economic fall-out is threatening our survival and extinction, coupled with the regulations, acts, laws and standards; they are all coming to us at the same time.”
Liburd pointed out that there was a haste to implement the various acts and regulations to get the industry properly regulated but “no plan to take us there”.
Premier of Nevis Hon. Vance Amory however suggested that a regulatory tightening of the industry was warranted and the credit unions should make the necessary adjustments to cope with the new regulations.
“I believe there is an agreement amongst all the parties that we cannot continue with the present regulatory environment where regulators lack the training and capabilities to undertake effective oversight of these institutions,” he said.
Hon. Amory said while industry oversight should be improved, it should be done efficiently and professionally and not through the imposition of “draconian regulatory systems” which would hamper the growth and effectiveness of the credit unions.
Prime Minister and Minister of Finance Hon. Dr. Denzil Douglas also agreed that because credit unions handle millions of citizens’ money, the industry should be properly regulated. He hastened to add however that the industry should not be “over-regulated”.