BANKING SYSTEM OF ANGUILLA

Financial and banking facilities fall under the Eastern Caribbean Central Bank Agreement Act and the Banking Act. The financial system is comprised of the commercial banks, insurance companies, development finance institutions and finance companies.
The ECCB is charged with regulating banking business on behalf of and in collaboration with the Government. The Banking Act gives responsibility for the financial system to the ECCB. The Minister of Finance has ultimate authority under the Act but is required to act in
consultation with and on the recommendation of the ECCB, but in respect of the examination of banks and other financial institutions the ECCB has complete authority.
The banks operating in Anguilla are strict in their adherence to know your-customer rules in opening and maintaining bank accounts.

Eastern Caribbean Central Bank
The Eastern Caribbean Central Bank (ECCB) was established in October 1983. It is the Monetary Authority for a group of eight island economies namely - Anguilla, Antigua and Barbuda, Commonwealth of Dominica, Grenada, Montserrat, St Kitts and Nevis, St Lucia, and St Vincent and the Grenadines. The mission of ECCB is to maintain the stability of the EC dollar and the integrity of the banking system in order to facilitate the balanced growth and development of member states. The monetary arrangements are characterized by :
- the issuance of a single common currency, the flow of which is unrestricted among its members.
- a common pool of foreign exchange reserves; and
- the existence of a Central Monetary Authority which decides on the Union's monetary policy.
The purposes of the Bank are:
- to regulate the availability of money and credit;
- to promote and maintain monetary stability;
- to promote credit and exchange conditions and a sound financial structure conducive to the balanced growth and development of the economies of the territories of the Participating Governments;
- to actively promote through means consistent with its other objectives the economic development of the territories of the Participating Governments.
The governing bodies of the Eastern Caribbean Central Bank are the Monetary Council and the Board of Directors. The Monetary Council is the highest decision making authority. It is comprised of one Minister appointed by each Government of the participating countries. The function of the Council is to provide directives and guidelines on matters of monetary and credit policy to the Bank. The Board of Directors is comprised of ten Directors - the Governor and Deputy Governor, and one Director appointed by each Government of the eight participating countries. The Board of Directors is responsible for policy and general administration of the Bank, while the Governor, the Chief Executive, is responsible for the day-to-day management and operations.

Domestic Banking
Domestic banks are licensed under the Banking Act. There are currently four domestic banks. Two of the domestic banks are of indigenous capital, National Bank of Anguilla and Caribbean Commercial Bank (Anguilla), and are testament to the strength of the Anguillian economy in that they are the two largest banks in terms of asset base. The other two banks are well known international banks, FirstCaribbean International Bank and Scotiabank. Applications for domestic banking licenses must be made to the Minister of Finance, who may grant the license based on the recommendation of the bank supervisory authority, which is the Eastern Caribbean Central Bank (ECCB), based in St Kitts. The ECCB serves as the Central Bank to all member states of the Organization of Eastern Caribbean States, including Anguilla, and is responsible inter alia for regulating and supervising all domestic banks within member states.

Offshore Banking
Offshore banking licenses are granted under the Trust Companies and Offshore Banking Act (TCOBA). Under the TCOBA, a banking license is granted to applicants who are fit and proper and qualified to carry on offshore banking business. Under current guidelines offshore banking licenses will only be granted to:
- branches or subsidiaries of banks with a well-established and proven track record which are subject to effective consolidated supervision.
- banks which, although not subsidiaries, are closely associated with an overseas bank, and which, by agreement, will be included within the consolidated supervision exercised by the overseas bank’s home supervisory authority.
- wholly-owned subsidiaries of acceptable non-bank corporations whose shares are quoted on a recognized stock exchange, where the objective of the subsidiary is to undertake in-house treasury operations only, and where such operations are fully consolidated within the published financial statements of the parent company.
Banks will only be granted licenses if their place of incorporation, mind and management are within the same jurisdiction, or, in the case of a subsidiary, if the mind and management is located in the jurisdiction in which consolidated supervision is being exercised.
In reviewing the application, the Commission will expect to be satisfied that:
- the management has a proven experience in a relevant field of banking;
- the controllers are fit and proper people to undertake the functions envisaged and that the ongoing management will be competent;
- the institution will conduct its business in a prudent fashion;
- the institution has devised an appropriate and sustainable business plan;
- adequate capital and other resources will be provided in relation to the business plan. The minimum capital requirement for a bank is US$250,000 or the equivalent amount in another currency. However capital adequacy will depend on the institution's capital and reserves covering risk-weighted assets to an acceptable ratio.
- direct confirmation has been received from the supervisory authority in the country in which the institution or its proposed parent is incorporated, that the authority consents to - the establishment of the institution in the host territory; that it will exercise consolidated supervision over the institution’s overall activities including within the host territory and will cooperate fully in the sharing of regulatory information with the Commission and will provide all the information that the Commission needs to perform its functions;
- the applicant will appoint approved auditors who will perform audit work according to internationally accepted auditing standards.

Financial Services Commission
The Financial Services Commission was established by the enactment of the Financial Services Commission Act on 26th November 2003 and it commenced operations on 2nd February 2004. The creation of the Commission allows Anguilla to meet international standards in the structure and administration of its financial services regulatory body.
The Commission’s functions are to:
- supervise financial services licensees in accordance with legislation, regulations and codes;
consider and determine applications for licences and registrations;
- monitor compliance by regulated persons with the Anti-Money Laundering Regulations, Guidelines or Codes;
- monitor financial services business carried on in or from within Anguilla and to take action against persons carrying on unlicensed activities;
- administer the financial services enactments;
- supervise the administration of the Registry Acts by the Registrar of Companies;
- monitor the effectiveness of the financial services enactments to ensure they meet internationally accepted standards;
- advise the Governor and Government of Anguilla on matters relating to financial services;
- encourage the development of high professional standards within the financial services industry, and to promote industry codes of conduct;
- maintain contact with foreign regulatory authorities and international associations of regulatory authorities relevant to the Commission’s functions and to provide regulatory assistance to foreign regulatory authorities in accordance with the Act;
- provide information and advice to licensees and the public concerning financial services as appropriate;
- take measures to develop and protect the financial services industry in Anguilla..
The Act also covers a number of administrative obligations and powers of the Commission in the following areas:
- appointment of a Board and the Board’s role of oversight of the Commission;
- general powers of the Commission;
- funds and resources of the Commission;
- requirements for budgets, accounts and annual report; the annual report is a public document;
- power of the Commission to gather regulatory information;
- power of the Commission to disclose information to another regulatory body for regulatory purposes and the checks and restrictions that the Commission will be required to take into account before disclosing such information;
- enforcement powers and disciplinary action available to the Commission arising from failure by licensed institutions to do certain acts required by the legislation or from misconduct;
- formation of an Appeals Board;
- conflicts of interest issues;
- the ability of the Commission to issue Regulations, Codes and Guidance Notes.

Financial Institutions Operating
Domestic :
Caribbean Commercial Bank (Anguilla) Limited
FirstCaribbean International Bank (Barbados) Limited
National Bank of Anguilla Limited
Scotiabank Anguilla Limited

Offshore :
Caribbean Commercial Investment Bank Ltd
Foreign Commerce Bank Limited
National Bank of Anguilla (Private Banking and Trust) Limited