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Turks and Caicos: Offshore Business Sectors

Banking

In recent years in line with international banking guidelines the Turks and Caicos Islands have adopted a policy of accepting only established banks or the treasury operations of listed corporations. In 1998 Belize Bank selected the Turks and Caicos Islands as the venue for its first venture outside Belize making Belize Bank only the 4th bank ever to be licensed in the Turks and Caicos Island for domestic purposes. The introduction of mutual funds legislation was expected to attract further applications for banking licences. There are eight licensed banks in the jurisdiction, most of which are licensed to carry out domestic and international services from within the islands.

Two types of banking licence can be granted:

  • National Banking Licence: This licence is granted for banking activities to be carried out locally with islanders and other residents and will only be granted to the branches or subsidiaries of banks which have an established track record and which are subject to effective consolidated supervision by their home supervisory authority. Exceptionally a national banking licence may also be granted where the bank is predominantly locally owned.
  • Overseas Banking Licence: This licence is granted for banking activities which are to be carried on outside the Turks and Caicos Islands. The holder of such a licence cannot accept deposits from or lend to residents of the Islands. An application for such a licence will only be considered from:
    • The branches or subsidiaries of banks with an established track record and which are subject to effective consolidated supervision by the overseas banks home supervisory authority
    • Banks which although not subsidiaries are closely associated with an overseas bank and which by agreement will be included within the consolidated supervision exercised over the overseas bank by the overseas banks home supervisory authority
    • Wholly owned subsidiaries of major corporations where the objective of the subsidiary is to undertake in house treasury operations which are fully consolidated within the published financial statements of the parent company.

All banking licences are subject to continual detailed review. Whilst there are no published guidelines as to the minimum capital, two of the main requirements are the submission of a detailed business plan and the written consent of the home supervisory banking authority. A national banking licensee holder must file monthly and quarterly statements. An overseas banking licensee holder is required to file less detailed returns on a quarterly basis. All banks must submit annual audited accounts. See Law of Offshore for further details of the application process and the supervisory regime; see Offshore Legal and Tax Regimes for details of fees payable.

 

 

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