Offshore banks get the boot

Three offshore bankS here have had their licences revoked.

The International Financial Services Authority (IFSA) recently moved to stop the three Offshore banks from carrying on business “in a manner detrimental to the public interest, and knowingly providing false information to the Authority”.{{more}}

Horizon International Bank Ltd had its license revoked on April 4, 2005, Transglobal Bank Ltd April 13, 2005, and Triton Capital Bank Ltd, that same day.

The revocation of the Class A banks licenses was confirmed by Louise Mitchell, Executive Director of IFSA.

In a Special Report, issued in response to a request from SEARCHLIGHT, on the recent revocation of the Offshore Banks’ licenses, Mitchell explained the reasons for IFSA’s actions.

The reasons listed, including “insolvency, carrying on business in a manner detrimental to the public interest, contravention of provisions of the International Banks Act (such as failure to be adequately capitalized), ceasing to carry on international banking business; being in the process of being wound up, and knowingly providing false information to the Authority”.

The executive director said “the revocations demonstrate that the Authority continues to show a low tolerance towards financial institutions that are not in compliance with the laws and regulations”.

Mitchell said: “As regulators, we expect that the institutions conducting business in the jurisdiction to be compliant with the laws and regulations of the country; to abide by prudential banking practices and to have a physical presence here.”

All three banks, whose licenses were revoked, are now in the process of being involuntarily wound up, with KPMG and PriceWaterhouseCoopers acting as liquidators.

Meanwhile, Amco Bank has surrendered its banking license and has gone into voluntary liquidation.

There are at present seven international banks duly licensed in St. Vincent and the Grenadines.