Attorney General Senator Allyson Maynard-Gibson revealed that the seven credit unions operating in The Bahamas hold assets valued at approximately $327.6 million as of December 31, 2013, and that the Bahamas Cooperative Credit Unions Bill 2014 is intended to modernize and strengthen the regulation of this "big business".

The bill seeks to provide for the registration, continuance, supervision and management of cooperative credit unions by The Central Bank of The Bahamas.

The bill was the subject of debate in the Senate on Thursday and the attorney general touted the benefits of the new legislation. "The cooperative credit unions industry has registered significant growth over the past five years," Gibson said.

"The assets held by seven credit unions operating in The Bahamas was approximately US$327.6 million, as of December 31, 2013. Globally, there are 57,000 cooperative credit unions existing in 103 countries which collectively hold assets in excess of $1.5 trillion."

She noted that the Department of Cooperative Development in the Ministry of Agriculture, Marine Resources and Local Government is responsible for the regulation and supervision of the cooperative credit unions, and the governing legislation is the Cooperative Societies Act.

According to Maynard-Gibson, that legislation, due to its age, "does not meet current yardsticks of international best practices".

"Consequently, in 2011 the government of The Bahamas invited the Central Bank of The Bahamas to assume regulatory and supervisory responsibility for the cooperative credit union industry, having regard to three factors: recognition of thegrowing size and complexity of the sector; the view held by internationals agencies such as the World Council of Credit Unions, CFTAT and others that the sector be supervised and regulated by the entity responsible forfinancial stability, which is the Central Bank; and the desire for greater consolidation in the domestic financial regulatory space," she reported.

The bill exempts co-operative credit unions with assets less than $1 million from some of the reporting requirements, such as the need to supply audited financial statements to the Central Bank and the need to maintain the statutory reserve liquidity deposit, she explained.

"So, small credit unions will not fall under the ambit of this Bill. They will continue to operate as they do now and will not be subject to this regulatory framework," the AG clarified. "Co-operatives manage millions of dollars - they are big business. And, regrettably, administrators too frequently betray trust.

To this we must add that every financial institution must have in place the means to protect itself from money laundering and financing of terrorism," she said.

"These Bills (The Bahamas Co-operative Credit Unions Bill, The Financial Transactions Reporting (Amendment) (No. 3) Bill, 2014, The Co-operative Societies (Amendment) Bill, 2014, The Central Bank of The Bahamas (Amendment) Bill, 2014, The Business Licence (Amendment) (No. 2) Bill, 2014 and The Bank and Trust Companies Regulation (Amendment) Bill, 2014) protect Co-operatives and enhance the second pillar of The Bahamas' economy, financial services," Gibson told her fellow Senators.

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