Let me elaborate on these. Safety and soundness of financial institutions The safety and soundness of financial institutions is a function of effective legislation and prudential supervision. The Reserve Bank is concerned with the safety and soundness of financial institutions because at the end of the day, it is the depositor’s money that needs to be protected.
In the case of insurance companies, it is the policyholder’s funds and in the case of the Fiji National Provident Fund, it is the members’ contributions. The supervisory regime must ensure that the monies of consumers are protected and their interests are safeguarded. For this reason, the Reserve Bank licenses, regulates and supervises a range of financial institutions.