Banking Act of Grenada: Regulations for Financial Institutions
Introduction
The Banking Act of Grenada outlines the regulations for financial institutions operating in the country. The following sections highlight key points from the excerpt:
Restrictions on Interest Acquisition
- The Central Bank is prohibited from acquiring an interest in any local financial institution except with the consent of the Minister.
- This restriction aims to prevent undue influence and maintain control over the financial sector.
Actions Requiring Approval
- Certain actions by financial institutions, such as:
- Transferring assets
- Reducing capital
- Altering names
- Merging or consolidating
- Amending instruments or charters
- Require approval from the Central Bank with the Minister’s recommendation.
- This ensures that significant changes are made in a controlled manner to maintain stability and compliance.
Revocation of Licence
- The Minister can revoke a licence if:
- The financial institution fails to comply with conditions
- Breaches provisions of the Act
- Ceases operations
- Conducts affairs detrimentally
- Fails to maintain sufficient capital or liquidity
- Does not meet minimum licensing criteria.
- This provision allows for corrective action in case of non-compliance or significant issues.
Notice and Appeal
- Before revoking a licence, the Minister must give written notice specifying grounds and allowing the institution to submit objections.
- The decision can be appealed to the High Court within 14 days.
Publication of Revocation
- After revocation, a notice is published in the Gazette and local newspapers to inform the public about the change.
Licence Fees
- Financial institutions must pay an annual licence fee as prescribed by the Minister.
- The fees go into the Consolidated Fund.
- Different fees may apply to different classes or categories of financial institutions.
Penalty for Default
- A person who fails to comply with requirements regarding licence fees faces unspecified consequences.