OREANDA-NEWS. This year, the Bank of Lithuania will implement 22 measures for the reduction of the administrative burden of financial market participants. The simplification of the provision of information and other supervision-related procedures that commenced two years ago has already enabled financial market participants to save almost 15 thousand working hours per year. 

‘Without requiring part of information that is no longer as relevant, as well as abandoning other procedures that have become formal, we make the activities of both supervised market participants and of our own, as the supervisory authority, more efficient’ says Vytautas Valvonis, Director of the Supervision Service of the Bank of Lithuania. According to him, ‘the financial sector — the vital artery of domestic economic life — will operate more effectively, when fewer reports will be required from it. Supervisory officials will be able to fully focus on key issues — consistent monitoring, deeper analysis, more effective investigation and maximally efficient supervision.’

According to V. Valvonis, the major innovation, which is expected to be implemented in 2016, is that financial market participants will be able to submit to the Bank of Lithuania’s Supervision Service documents signed with a qualified electronic signature. Not only will this save paper and postage expenses but time as well. Information exchange will be much faster.  

In addition, the Bank of Lithuania, in reducing the administrative burden of financial market participants, plans to no longer collect part of information on a periodic basis, while some reports will be combined. In order to help businesses avoid the double burden of reporting, information already accumulated in state registers will be used for supervisory purposes.  

The Bank of Lithuania will initiate legislative amendments that will exempt payment and electronic money institutions from the obligation to have a Supervisory Board, while institutions holding a license for restricted activity — from the obligation to have both a Supervisory Board and a Board. Moreover, banks will not have to submit their agreement with a chosen audit company to the Supervision Service, while financial brokerage, management, payment and electronic money institutions — a copy of such an agreement. 

In drawing up a plan of measures for reducing the administrative burden, the Supervision Service has additionally surveyed financial market participants subject to its supervision and took into account part of the proposals received.

The Bank of Lithuania began to systematically ease the administrative burden for supervised market participants as early as in 2014. Having implemented 20 measures, financial market participants have already saved about 15 thousand working hours over the year, which corresponds to the annual working time of eight employees. The Bank of Lithuania, in turn, has saved more than 3 thousand working hours, or the annual working time of almost two employees. Such an effect was achieved mainly due to the reduced amount of information to be collected and provided on a mandatory basis. Furthermore, bank and credit union licensing procedures have been simplified.

The Bank of Lithuania currently supervises over 470 financial market participants, including banks, credit unions, insurance undertakings, payment institutions, management companies,  and consumer credit providers. In supervising the financial market, the Bank of Lithuania uses a risk-based approach to supervision, which means that it concentrates its resources for the systemically most significant financial market participants or the financial services and products posing the highest risk for consumers.