Find Banking and Financial Services expertise in Bahamas, The
In terms of development, size and market share, The Bahamas is generally regarded as one of the world’s leading centres for offshore banking. There are between 300 to 400 registered offshore banks and trusts on the islands. A typical offshore bank provides services such as an offshore bank account that has the added investment benefits of low or no taxation, relaxed regulation and, at times, better protection. The Bahamian economy has been increasingly diversifying into financial services, most prominently banking, trusts, mutual funds and insurance. The financial services sector plays a crucial role in supporting and developing the economy. This occurs both directly through employment opportunities, and indirectly by procuring from and providing vital services to other key sectors of the economy. Additionally, the financial services sector accounts for a significant proportion of GDP, 36 per cent in 2011. The domestic financial system, which is dwarfed by the offshore sector, is dominated by banks, mostly subsidiaries and branches of United States and Canadian entities. Between locally and foreign-owned banks the sector comprises nine institutions. Domestic banks provide typical commercial banking services such as personal banking and corporate banking. Domestic banks also engage in significant levels of offshore activity. In the wake of the global financial crisis the banking sector has undergone consolidations and decreased service fees (2011).
Regulation of Financial Services
International concerns over weaknesses in the regulatory regime, potentially overlooking illicit activities, prompted thorough government measures at the end of 2000 in order to strengthen regulation and supervision. There is now a relatively complex system of overall supervision with five agencies that perform some type of regulatory function in relation to the financial sector, sometimes with overlapping roles. The Central Bank of The Bahamas (CBB) oversees the banks and trust companies, while the Securities Commission of The Bahamas (SCB) is responsible for licensing and supervision of the securities and mutual funds industry.
Development of Financial Services
The World Bank Ease of Doing Business (2011) rated the Bahamas 78th in the world (out of 183 countries) for getting credit, placing it number 2 in the Caribbean region behind Trinidad and Tobago but ahead of countries like Jamaica and Antigua and Barbuda. Its ranking of 111 for protecting investors is below average for the region.