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Cayman Islands Monetary Authority Assumes New Role as Independent Regulator

January 1, 1997 - Grand Cayman, Cayman Islands

The Cayman Islands Monetary Authority (CIMA) officially took over its new role as a merged entity between the Financial Services Supervision Division and the Currency Board, effective January 1, 1997.

Objectives of CIMA

As a statutory body, CIMA is tasked with enhancing the regulation of the financial services industry and promoting financial stability in the Cayman Islands. The Authority is subject to the Public Management and Finance Law (2013 Revision) and is required to submit its budget proposal to the Cabinet for approval by the Legislative Assembly.

Responsibilities of CIMA

Prior to independence, the Authority’s primary responsibility was the supervision of licensees and monitoring compliance with money laundering regulations. The Government had ultimate decision-making power regarding licensing and disciplinary actions. On the currency side, CIMA is responsible for issuing and redeeming Cayman Islands currency notes and coins, as well as managing the Currency Reserve on behalf of the Government.

Gained Operational Independence

In a significant development, CIMA gained operational independence in 2003, allowing it to make key decisions independently. The Authority’s Board of Directors is now solely responsible for operational decision-making, including licensing and registration of regulated financial businesses.

Accountability

CIMA remains accountable to the Government and Legislative Assembly, collecting licensing fees on behalf of the Government. Any surplus funding will be paid into the General Reserve unless agreed otherwise by the Governor.

Commitment to Promoting Market Confidence

In a statement, CIMA’s Managing Director highlighted the Authority’s commitment to promoting market confidence, consumer protection, and the reputation of the Cayman Islands as an international financial center. “We are committed to reducing the possibility of financial services being used for money laundering or other crime, while maintaining the competitive position of our financial markets,” he said.

Organizational Structure

CIMA is organized into 12 divisions, including five supervisory divisions, four non-supervisory divisions, and three operational divisions. The Authority’s management structure includes a Board, Executive Committee, and Managing Director, with day-to-day operations managed by the Managing Director and Deputy Managing Directors.

Regulatory Handbook

The Cayman Islands Monetary Authority Regulatory Handbook - Volume I (August 2017) outlines CIMA’s objectives, powers, and responsibilities in detail, providing a comprehensive guide to the Authority’s functions and operations.