ST. JOHN’S, Antigua, March 23 2015 – Prime Minister and Minister of Finance and Corporate Governance, Gaston Browne will pilot a new Banking Act when the House of Representatives meets today.
The Act, which replaces the 2005 Bill, seeks to provide for the regulation and supervision of Banking business, the establishment of a single banking space, the ownership structures for licensed financial institutions, the licensing of financial holding companies, the corporate governance of licensed financial institutions, the framework for the official administration of licensed financial institutions and for the incidental and related matters.
Some of the changes in the new legislation include removing the authority from the Minister of Finance to issue licenses for banks and financial institutions and giving that authority to the Eastern Caribbean Central Bank. Under this new guideline, a license given to a bank, gives that bank the authority to operate throughout the entire currency union.
The new legislation also sets new financial requirements and limitations for establishing a bank, credit union or other financial institutions. If operating as a bank, the minimum required capital has been set to not less than twenty million dollars. If operating as a credit or other financial institution, the minimum required capital will be not less than five million dollars.
The new legislation also seeks to set the criteria for determining whether a person is fit and proper to be a director, significant shareholder, or officer of a licensed financial institution or holding company. Each licensed financial institution or holding company will be required to give written notice to the Central Bank of the appointment or election of a director or officer within thirty days of the election or appointment of the director or officer. If the Central Bank is not satisfied that a director or officer is not a fit and proper person in accordance with its criteria, the Central Bank will direct the removal of the director or officer.
The new Banking Act will also address issues of receivership and compulsory liquidation, transfers of banking property and business, and ownership structures.
The House of Representatives will also move the First Reading if the Eastern Caribbean Asset Management Corporation Act and the Eastern Caribbean Central Bank (Amendment) of Schedule Act, 2015.
