Regulatory Authority Must Approve Applicants for Banking Licence
The Regulatory Authority has strict guidelines in place to ensure that only suitable applicants are granted a banking licence.
Application Process
Under section 8 of the ordinance, the authority must determine each application within six months of receipt. If an applicant fails to provide additional information or comply with certain requirements, the timeline may be extended.
Once an application is deemed complete, the authority will assess whether the applicant meets the necessary criteria for a banking licence. This includes factors such as:
- Financial stability
- Management expertise
- Compliance with regulatory requirements
Restrictions and Revocation
In certain circumstances, the Regulatory Authority may impose restrictions on a banking licence or even revoke it altogether. This could occur if an institution fails to meet its obligations, engages in risky business practices, or poses a threat to financial stability.
Before imposing any restrictions or revoking a licence, the authority must serve written notice on the institution, outlining the grounds for its decision and providing an opportunity for representations to be made.
The authority may also vary or revoke existing restrictions and must inform the competent authorities of other jurisdictions where the institution operates in such cases.
Public Statement
In certain circumstances, the Regulatory Authority may choose to issue a public statement announcing that a particular banking licence has been restricted or revoked. This is intended to protect consumers and maintain market confidence.
Review Process
Any person aggrieved by a decision made by the Regulatory Authority may seek a review of that decision. The authority must reconsider its decision in light of any additional information submitted in support of the review request.
Upon review, the authority may:
- Confirm its original decision
- Reverse its original decision
- Vary its original decision
In cases where the authority confirms its original decision, an aggrieved person may seek judicial review subject to certain requirements.
Use of the Word “Bank”
No person other than a bank with a current licence may use the word “bank” or any derivative of it in their business description or title without written permission from the Regulatory Authority. This is intended to prevent confusion and maintain consumer trust in the banking sector.
In cases where a bank incorporated outside St Helena seeks to operate in the territory, it must obtain a banking licence from the authority and comply with all relevant requirements.