Revised Laws of Saint Lucia (2023)

GENERAL, SUPERVISORY AND REGULATORY CONTROL

ARTICLE 52
ROLE OF MONETARY COUNCIL

(1)     The Monetary Council shall —

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   (a)     vet the nominees for the initial Board of Directors and appoint the nominees by majority vote; and

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   (b)     provide initial policy guidance, as needed, during the first year of operation of the Credit Guarantee Corporation.

(2)     The Credit Guarantee Corporation shall promptly comply with directives and requirements under paragraph (1).

ARTICLE 53
REGULATION BY CENTRAL BANK

(1)     The Central Bank shall act as the Regulator of the Credit Guarantee Corporation.

(2)     The Central Bank has the power to ensure compliance with this Agreement and may —

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   (a)     conduct onsite and offsite examinations of the business of the Credit Guarantee Corporation;

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   (b)     take measures that are necessary to enforce this Agreement.

(3)     The functions of the Central Bank shall include —

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   (a)     reviewing notifications of the appointment of Directors and Officers;

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   (b)     recommending the removal from Office of Directors and Officers who are disqualified from holding office;

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   (c)     taking remedial action to ensure compliance with this Agreement;

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   (d)     examining policies and procedures used by the Credit Guarantee Corporation for credit analysis, including loan guarantee application processing, monitoring of the guarantee portfolio, monitoring liquidation activities, guarantee payment procedures and Participating Lender oversight;

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   (e)     ensuring that the Credit Guarantee Corporation is appropriately managing risk including credit risk from the guarantee program, reputational risk, etc.;

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   (f)     examining policies and procedures for human resource activities;

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   (g)     examining policies and procedures for procurement activities;

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   (h)     examining policies and procedures for accounting;

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   (i)     examining policies and procedures for investment of capital, fee revenue and any other funds;

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   (j)     ensuring that the Board's Audit and Risk Committee has hired an outside auditor and that the auditor has provided audited financial statements on an annual basis;

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   (k)     ensuring that the Credit Guarantee Corporation has established a Continuity of Operations Plan and that the employees understand the plan and know how to implement it;

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   (l)     ensuring that the Credit Guarantee Corporation has taken steps to protect sensitive data that it may acquire including employee data and credit data; and

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   (m)     any such other actions as the Central Bank determines are appropriate for the responsible oversight of the Credit Guarantee Corporation.

(4)     The Central Bank may direct the Credit Guarantee Corporation to take action to remedy any deficiency.

(5)     The Central Bank may charge the Credit Guarantee Corporation for its services.

ARTICLE 54
REPORTS AND INSPECTIONS

(1)     The Central Bank may, for the purposes of this Agreement, request that the Credit Guarantee Corporation and Participating Lenders to submit reports or other information, or cause to be inspected the status of operations, books and documents or other necessary matters.

(2)     Requests for information from Participating Lenders under para-
graph (1) shall be limited to information relating to providing loans to qualifying borrowers.

ARTICLE 55
CENTRAL BANK'S POWERS OF REMEDIAL ACTION

(1)     The Central Bank shall take such remedial actions as it determines are consistent with the level of risk inherent in the activities of the Credit Guarantee Corporation and which it believes will best promote the operation of the Credit Guarantee Corporation in a safe and sound manner.

(2)     If, in the opinion of the Central Bank, the Credit Guarantee Corporation, a Director, or an Officer or employee of the Credit Guarantee Corporation —

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   (a)     engages in unsafe or unsound practices in conducting the business of the Credit Guarantee Corporation;

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   (b)     violates any provision of this Agreement; or

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   (c)     violates any prudential standard issued by the Central Bank to which the Credit Guarantee Corporation or person is subject,

     the Credit Guarantee Corporation may be subject to the remedial actions specified in paragraph (3).

(3)     Where the Central Bank has reasonable cause to believe that the circumstances referred to in paragraph (2) have occurred or are likely to occur, it may take one or more of the following measures —

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   (a)     issue a written warning as it considers necessary or appropriate;

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   (b)     conclude a written agreement with the Credit Guarantee Corporation for a programme of remedial action;

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   (c)     issue an order to the Credit Guarantee Corporation;

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   (d)     issue directions as it considers necessary in relation to the persons comprising the management of the Credit Guarantee Corporation.

(4)     An agreement, order, or direction under paragraph (3) may require any or all of the following —

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   (a)     to cease and desist from the specified practice or violation;

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   (b)     affirmative action to correct the condition resulting from the specified practice or violation; or

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   (c)     any specified remedial action.

ARTICLE 56
ADDITIONAL CENTRAL BANK REMEDIAL ACTIONS

The Central Bank may make a recommendation to the Board of Directors to approve one or more of the following remedial actions to ensure the sustainability of the Credit Guarantee Corporation —

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   (a)     restrict the Credit Guarantee Corporation from providing further credit guarantees;

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   (b)     require the Credit Guarantee Corporation to suspend for a specified period of time, alter, reduce, or terminate any activity that in the opinion of the Central Bank has caused material losses to the Credit Guarantee Corporation, or presents excessive risk to the Credit Guarantee Corporation;

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   (c)     require the Credit Guarantee Corporation to sell, liquidate, or otherwise dispose of part of its business;

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   (d)     prohibit payment of bonuses or incentive compensation to any Director or Officer;

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   (e)     prohibit the Credit Guarantee Corporation from paying a dividend or making a distribution on its share capital or issue rights, shares or bonus shares to Participating Governments;

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   (f)     suspend or remove any Officer of the Credit Guarantee Corporation or restrict the Officer's powers;

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   (g)     remove any or all of the Directors or restrict their powers;

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   (h)     any other action necessary or appropriate to eliminate the basis for requiring remedial action.

ARTICLE 57
REMEDIAL ACTIONS AGAINST DIRECTORS, OFFICERS OR EMPLOYEES

(1)     For the purposes of this Article, “relevant person” means a Director, or an Officer, or employee of the Credit Guarantee Corporation.

(2)     The Central Bank, with respect to a relevant person, may take any or all of the following remedial actions —

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   (a)     require the relevant person to reimburse the Credit Guarantee Corporation for losses caused by a violation;

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   (b)     suspend the relevant person from his position with the Credit Guarantee Corporation or the Board or declare him to no longer be fit and proper.

(3)     If the Central Bank has reasonable cause to believe that the Credit Guarantee Corporation, a Director, an Officer, an employee, an attorney, an accountant or other professional has engaged or is engaging in criminal or fraudulent activities, it shall immediately refer the matter to the authorities responsible for investigating and prosecuting the activities.

ARTICLE 58
ADDITIONAL REMEDIAL ACTION AGAINST DIRECTORS, OFFICERS OR EMPLOYEES

(1)     For the purposes of this Article, “relevant person” means a Director, or an Officer, or employee of the Credit Guarantee Corporation.

(2)     If in the opinion of the Central Bank any relevant person —

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   (a)     wilfully or repeatedly has violated this Agreement or prudential standard issued by the Central Bank to which the Credit Guarantee Corporation or relevant person is subject following a written warning or an order from the Central Bank under Article 55;

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   (b)     has been engaging in an unsafe or unsound practice that has resulted in a material loss to the Credit Guarantee Corporation or financial gain to a person; or

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   (c)     has been conducting his or its affairs in a manner detrimental to the interests of the participating borrowers,

     the relevant person shall be subject to the remedial actions specified in paragraph (3).

(3)     In addition to the actions in Article 57, the Central Bank may take one or more of the following actions —

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   (a)     direct the dismissal of the relevant person from his position with the Credit Guarantee Corporation or the Board;

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   (b)     prohibit the relevant person from serving in or engaging in the credit guarantee business for a stated period.

ARTICLE 59
FAILURE TO COMPLY WITH REMEDIAL ACTIONS

The Credit Guarantee Corporation or any Director, Officer, or employee who fails to comply with any requirement or contravenes any prohibition imposed under this Part is liable to a penalty as may be prescribed by law.

ARTICLE 60
SUSPENSION OF PERSONS CHARGED WITH CRIMINAL OFFENCE ETC.

If any person referred to in Articles 57 and 58 is charged with a criminal offence involving dishonesty or breach of trust and his continued service or participation in the Credit Guarantee Corporation —

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   (a)     poses, or may pose a threat to the interests of the Participating Borrowers; or

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   (b)     threatens, or may threaten to impair public confidence in the Credit Guarantee Corporation,

the Central Bank may issue an order directing the temporary suspension of the person from his position with the Credit Guarantee Corporation or the Board and the removal of the person from the position, in the event of conviction of a criminal offence.