Bamba Saho, Director General of West African Monetary Agency(WAMA) has disclosed that harmonisation of ECOWAS bank, microfinance supervision and regulation will reduce the regulatory and cost burden on financial institutions associated with compliance with multiple regulatory regimes, adding that it will also contribute to improving the monetary policy transmission mechanism and reduce fragmentation of the financial system.
He made these remarks recently at the opening workshop of Expert Committee on the harmonisation of regulatory and supervisory frameworks for banking and microfinance institutions in ECOWAS member states organised by West African Monetary Agency (WAMA), in collaboration with the Central Bank of the Gambia.
“A harmonized ECOWAS bank and microfinance supervision and regulation regime will reduce the regulatory regimes. It should also contribute to improving the monetary policy transmission regulatory and cost burden on financial institutions associated with compliance with multiple mechanism and reduce fragmentation of the financial system,” Bamba Saho WAMA Director General disclosed.
According to him, effective implementation of the harmonisation program requires an assessment of existing regulatory and supervisory frameworks for banks regulatory, supervisory frameworks for bank and microfinance institutions, adding that it will requires the establishment of an Expert Committee, and adoption of an efficient harmonization strategy.
The former Governor of Central Bank of The Gambia continued to disclosed that WAMA had carried out preliminary review of existing regulatory and supervisory frameworks for banks in 2012, noting that it has developed terms of reference with a detailed activity plan for the Expert Committee, and received nominations from all ECOWAS Member Central Banks for membership on the Experts Committee.
“We also hosted the inaugural meeting of the Expert Committee in a virtual format in January 2022. Given that, bank and microfinance institutions are under the direct regulation and supervision of Member Central Banks,we decided to commence the implementation of the program with the harmonization and operationalisation of bank and microfinance institutions, regulatory and supervisory frameworks,” WAMA DG highlighted.
He added: “For the effective conduct of this program, it would be necessary to involve the key stakeholders like West Africa Monetary Institute (WAMI), and the Member Central Banks, who have extensive knowledge of financial system developments, regulation, and supervision in their various jurisdictions. It is within this framework existing regulatory and supervisory frameworks for bank and microfinance institutions in the ECOWAS Members States and/or Zones and the internationally accepted standards governing the regulation and supervision of such institutions.”
WAMA Director General adduced that regional workshop will offer the opportunity for participants to identify the differences and similarities in the existing regulatory and supervisory frameworks for banking and microfinance institutions in the ECOWAS Member States
and the internationally accepted standards to be considered for the development of a common regional framework for the regulation and supervision of banking and microfinance institutions.
