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Maldives Introduces New Regulations for Banking Licenses
The Maldivian government has introduced new regulations governing the issuance of banking licenses in the country. The regulations, published in a gazette notice, aim to ensure that only reputable and financially sound banks operate in the Maldives.
Eligibility Criteria
Banks seeking to establish operations in the Maldives must meet certain eligibility criteria, including:
- Registration under the Companies Act of the Maldives or the Companies Act of their home country
- Consolidated supervision by a supervisory authority in their home country for foreign banks
Application Process
Applicants must provide detailed information about their financial history, proposed operations, and management structure to the Maldivian Monetary Authority (MMA). The MMA will evaluate the fitness of the applicant to operate a bank in the Maldives based on this information.
Evaluation Criteria
The regulations specify that banks seeking a license must demonstrate that they meet certain criteria, including:
- A sound financial history
- Adequate staffing and resources
- Robust risk management policies and systems
Additionally, the MMA may consider factors such as:
- The extent to which the applicant has fulfilled the credit and banking needs of communities in other countries
Application Timeline
Applicants must act expeditiously to provide required information and pay an application fee within a specified timeframe. Failure to complete the application process within three months may result in the application being deemed abandoned and the fee forfeited.
Post-Application Process
The MMA will publish standards for evaluating applications and issue written statements explaining its reasons for denying a request for a license.
Key Changes
- Registration under Companies Act of Maldives or home country
- Consolidated supervision by supervisory authority in home country for foreign banks
- Detailed information required about financial history, proposed operations, and management structure
- Evaluation criteria include sound financial history, adequate staffing and resources, and robust risk management policies and systems
- MMA may consider factors such as fulfillment of credit and banking needs in other countries
- Application fee payable to MMA within specified timeframe
- Failure to complete application process within three months may result in abandonment of application
The new regulations are expected to enhance the stability and integrity of the Maldivian banking sector, providing greater protection for depositors and investors.