Guernsey Outlines Risk-Based Supervisory Approach
by Jason Gorringe, Lowtax.net, London
28 November, 2017
The Guernsey Financial Services Commission has released new guidance explaining its risk-based approach to regulating the island's financial services sector.
The Commission currently supervises over 2,000 licensees who present a wide range of risks to the public, said to be from negligible to severe. To manage this risk the Commission uses the Probability Risk and Impact System (PRISM), which takes a "systemic approach" to risk management.
PRISM accords each licensee an impact rating and resources are allocated in proportion to that rating. In addition, PRISM can identify general or sectoral trends and themes.
PRISM is currently also used by the European Central Bank and the Central Bank of Ireland, and satisfies the International Monetary Fund's expectation that jurisdictions take a systemic approach to risk.
The guidance is available on the Commission's website.
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