Cyprus is one step before the establishment of a new, independent supervision authority on insurance and pension funds.
Finance Minister Haris Georgiadis said the government is ready to launch a public consultation and begin a dialogue with political parties and social partners in order to create a unified supervisory authority.
Following a meeting with Gabriel Bernardino, Chairman of the European Insurance and Occupational Pensions Authority (EIOPA), Georgiades said that the insurance and provident funds sector is important for the economy, and that there is a lot of room for improvement.
He said that ''there are more than 1300 provident funds in Cyprus, while in other larger countries there are a few dozen, funds that are strong and well-staffed''. The aim is to have the new Authority up and running by 2020.
The new regulatory body will consolidate the separate supervisory departments, the insurance supervision department together with the provident funds office which are currently attached to the Ministry of Labour, into a new authority based on the the model of the Cyprus Securities and Exchange Commission and the Central Bank of Cyprus. There will be an executive council, but also a non-executive part. The management structure will comprise the President of the authority, two executive and four non-executive council/board members.
Analysts see consolidation coming for the sector as supervision is expected to bring mergers and acquisitions.
In his own statements, Mr Bernardino said he supported the creation of this new authority, which is fully in line with the European recommendations. He stressed that the authority will create a stronger and more reliable supervisory system.