RSSThe Cayman Islands are among the world's leading offshore banking centres and have over 500 licensed banks and trust companies, including 45 of the world's top 50 international banks.
Bank and Trust companies represent 65 different countries in the world, including the United States, Canada, the United Kingdom, Switzerland, Hong Kong, Japan, Germany, France, Brazil, Mexico and Portugal. A person, firm, entity or association who or which has large or frequent banking transactions may find it profitable and convenient to own and operate a bank in the Cayman Islands.
This type of bank, usually private ("B" Restricted), has emerged as a result of the need to conduct financial transactions with as few restrictions as possible. Lending limitations, investment restrictions, reporting requirements, taxation, double taxation (where one may be taxed at home and abroad), compliance with burden-some government regulations and public disclosure of transactions all constitute restrictions which limit a businessman's ability to act as freely as he wishes.
Currently there are no restrictions whatsoever on the transfer of currency to or from the Islands or on the holding of assets outside of the Islands.
Most of the major banks operating in the Islands are branches or subsidiary companies of the world's leading banks. Most of the "A" licensed full service banks and trust companies are branches or subsidiaries of Canadian and European banks and are operated and managed in a manner similar to major international banks in Canada and Europe. But, one has to have a licence as stipulated by The Banks & Trust Companies Law (1995 Revision) in order to operate banking business on the islands.
Products & Services
Many of the major banks are full service retail banks and provide a variety of services, including the buying and selling of precious metals, securities, trading in currencies, commodities and investment in funds.
Moreover the benefits of using a Cayman bank as a base for operations include the ability to -
1. Conduct business free of taxation.
2. Freely exchange, trade or deal in any currency.
3. Make and switch investments through stockbrokers, mutual funds and other investment vehicles.
4. Operate bank accounts with a high degree of privacy.
5. Conduct offshore banking with reasonable but effective lending limits and investment restrictions.
6. Engage in business transactions free from excessive regulatory interference.
7. Issue letters of credit and bank guarantees.
Protection of customers' information
The combined effect of Section 13 of The Banks & Trust Companies Law and The Confidential Relationships (Preservation) Law is to prohibit disclosure of any information whatsoever not authorized by the customer or in accordance with the law and to make such disclosure punishable by fine or imprisonment or both.
The Monetary Authority
There is no central bank in the Cayman Islands but there is a statutory agency called The Cayman Islands Monetary Authority, which regulates and supervises the financial services industry, including the review and monitoring of all banks and trust companies on the island.
Duties of the Monetary Authority
The duties of the Monetary Authority are as follows:
(a) To maintain a general review of banking practice in the Islands;
(b) Whenever it thinks fit or when so required by the Governor, to examine by way of the receipt of regular returns or in such other manner as it thinks necessary the affairs or business of any licensee carrying on business in or from within the Islands for the purpose of satisfying itself that the provisions of the Law are being complied with and that the licensee is in a sound financial position and, whenever it thinks fit or when so required by the Governor, to report to the Government the results of every such examination;
(c) When required by the Governor to assist in the investigation of any offence against the laws of the Islands which it has reasonable grounds to believe has or may have been committed by a licensee or by any of its directors or officers in their capacity as such;
(d) To examine accounts and audited annual accounts required by Section 9 of the Law to be filed with the Authority and to report on them to the Governor whenever it thinks fit or when so required by the Governor;
(e) To examine and make recommendations to the Governor with respect to applications for licenses;
(f) To examine all proposals and make recommendations to the Governor in respect of the exercise of his powers under Sections 14, 15 and 16 of the Law; and
(g) To act as the adviser to the Governor and to take all necessary action to ensure the proper and just implementation of the Law.
