The Bahamas: Technical Assistance Report-Operationalizing the New Bank Resolution Framework and Amended Deposit Insurance Legislation—Second Mission

IMF Staff Country Reports, August 21, 2023

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Canonical URL: The Bahamas: Technical Assistance Report-Operationalizing the New Bank Resolution Framework and Amended Deposit Insurance Legislation—Second Mission

This technical assistance report on The Bahamas analyses operationalizing the new bank resolution framework and amended deposit insurance legislation-second mission.
The Central Bank of the Bahamas (CBOB) has made good progress in implementing recovery plans for the domestic systemically important banks (DSIBs).
The mission recommends that the CBOB:
- provide the DSIBs with structured feedback on their initial recovery plans; and
- based on lessons learned from the pilot, provide to all banks and credit unions updated industry-wide guidance that sets out high-level expectations on the content for recovery plans.
The CBOB is advised to develop a comprehensive strategy for resolving failed financial institutions.
The bank resolution law was strengthened in 2020 and provides the CBOB with the key resolution tools needed for an effective resolution regime.
However, some aspects of the law would benefit from review to better align with international principles and good practice.

Progress on implementing recovery plans for DSIBs has been good.
The 2020 strengthening of the bank resolution law equipped the CBOB with key resolution tools.
Gaps remain where aspects of the law could be reviewed to enhance alignment with international principles and good practice.

Provide structured feedback to DSIBs on initial recovery plans.
Develop updated industry-wide guidance for all banks and credit unions that sets out high-level expectations on recovery plan content, drawing on pilot lessons.
Develop a comprehensive strategy for resolving failed financial institutions.
Review aspects of the bank resolution law to better align with international principles and good practice.

Subject: Bank resolution, Bank resolution framework, Bridge bank, Contingency planning, Credit bureaus, Financial crises, Financial markets, International organization, Monetary policy
Keywords: Bahamas co-operative credit unions, Bank resolution, Bank resolution framework, bank resolution law, Bridge bank, Contingency planning, Credit bureaus, credit union law, Global, recovery plan, resolution framework