Opposition lawmaker wants deposit insurance agency held to high standard

Opposition Senator Karina Goodridge has thrown her support behind the Protection of Depositors Bill, but is urging the government to strengthen accountability measures to ensure the Barbados Deposit Insurance Corporation (BDIC) is held to the same reporting standards it expects of financial institutions.

The Friends of Democracy leader told the Senate that the bill’s overall objective of protecting depositors deserved support: 

“I support the objectives of the bill. I believe that every Barbadian who entrusts their savings to a licensed bank or a credit union deserves confidence that, should the institution fail, there is a credible and well-governed system and a mechanism of protection capable of protecting those insured deposits.”

But she argued that the legislation does not impose any consequences if the BDIC fails to submit its audited financial statements and annual reports within the timelines set out in the bill.

She pointed to Section 16, which requires the corporation to prepare audited financial statements and an annual report within four months of the end of the financial year, with the minister required to table those reports in Parliament within six weeks.

“The difficulty is that we know the tardiness that happens with government departments and state-owned enterprises when it comes to bringing reports in a timely manner,” she said. “There are no consequences whatsoever if those deadlines are missed.”

Senator Goodridge warned that delayed reporting could undermine public confidence in the very institution created to protect depositors:

“We have seen examples of statutory reports reaching Parliament months or sometimes even years later, and it is problematic, especially when we’re looking at building public confidence. 

“The moment that you don’t see the reports, then of course the public can’t have confidence in the institution and say, well, everything is working well.”

She also highlighted what she described as an imbalance in the bill, noting that while private financial institutions face financial penalties for failing to meet their statutory obligations, the BDIC itself would not face comparable sanctions.

“This bill imposes strict penalties on private institutions,” she said, citing provisions that allow for fines of up to $1 000 per day for member institutions that fail to submit required information or make required payments. “The private institutions are subject to financial penalties for failing to meet the statutory obligations, while the corporation itself faces no statutory consequence if it fails to meet its own reporting obligations.”

Senator Goodridge recommended amending the bill to require the minister to table a written explanation in Parliament whenever the corporation misses a reporting deadline, provide a revised completion date, publish the explanation alongside the overdue report, and refer persistent non-compliance to the Public Accounts Committee or another appropriate parliamentary committee for review.

(SB)