Saint Kitts and Nevis Tightens Banking Regulations
The government of Saint Kitts and Nevis has recently strengthened its banking regulations to safeguard depositor’s funds, maintain acceptable accounting standards, and satisfy capital requirements. The revised International Banking Ordinance aims to prevent the establishment of “brass plate banks” and protect the reputation of the jurisdiction.
Comprehensive Regulatory Framework
The ordinance provides a robust regulatory framework that ensures international banks operating in Nevis are properly monitored. A license can only be issued to eligible companies or qualified foreign banks, which must have a physical presence in Nevis approved by the Regulator of International Banking.
Eligible Companies and Qualified Foreign Banks
To qualify for a license, an eligible company must meet strict criteria, including:
- Being a wholly owned subsidiary of a bank indigenous to Saint Kitts and Nevis
- Having a chief executive officer with at least ten years’ experience in banking or finance
- Other requirements as specified by the Regulator of International Banking
A qualified foreign bank is defined as a bank with adequate capitalization and assets licensed to conduct domestic banking in its jurisdiction of incorporation.
Fees and Penalties
The ordinance prescribes various fees for licensing and regulatory services, including:
- Application fee: $7,500
- Initial license fee: $100,000
- Fines for non-compliance: up to $50,000
- Penalties for each month or day in default: $1,000
Offences and Penalties
Section 6 (2) of the ordinance provides for a fine not exceeding $500,000 for carrying on international banking without a license. Breach of condition of licence can result in a fine of up to $25,000, while unauthorized use of the word “bank” in a name can attract a penalty of up to $1,000 per day.
Applications and Supporting Forms
The application and supporting forms for international banking licenses are available online. The International Banking Division strongly advises applicants to contact them before completing and submitting an application form.
Saint Kitts and Nevis aims to establish itself as a responsible international financial centre, with the revised ordinance providing a robust framework for regulating international banks operating in the jurisdiction.