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Legal & Regulatory Framework
Banking Act
Organisation of Eastern Caribbean States Treaty
Banking Act
The ECCB Agreement Act 1983
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The New Banking Act
The new Banking Act is uniformly in force in the eight member territories of the Eastern Caribbean Currency Union, although there are some minor differences in the structure and style of the Act. Amendments to the new Banking Act were based in part on the Basle Committee on Bank Supervision - 25 Core Principles for Effective Banking Supervision and legislative gaps identified by the ECCB. Financial globalisation, the complexities of large conglomerates and the diversity of the products and services offered by financial institutions, have compelled regulators to adopt a more risk focussed approach to supervision. The new Banking Act addresses the need for effective, risk focussed supervision of financial institutions to ensure the safety and soundness of the financial system. It has refined the overall regulatory regime and enhanced the powers of the ECCB.

The table below illustrates the number, year and commencement date of the Banking Act in each member territory.

The Banking Act In Member Territories

     Anguilla       No 9 of 2005       1 January 2006
     Antigua & Barbuda (Amended August 2012)       No 14 of 2005       1 January 2006
     Commonwealth of Dominica       No 16 of 2005       31 March 2006
     Grenada       No 19 of 2005       31 March 2006

     Montserrat (available for purchase)
     Clerk of Council's Office
     Legislature Department
     No. 1 Farara Plaza

     Tel: (664) 491 2195
     Fax: (664) 491 6885
     Email: Legis@gov.ms

      No 2 of 2005       1 May 2005
     St Kitts and Nevis       No 4 of 2004       4 November 2005

     Saint Lucia (available for purchase)

     National Printing Corporation
     Cnr of Laborie and Jeremie Streets

     Tel: (758) 468 2199
     Fax: (758) 452 4582

     Email: npc@gosl.gov.lc

      No 34 of 2006       1 April 2007
     St Vincent and the Grenadines       No 33 of 2006       10 April 2007

The Act applies to all institutions that conduct banking business. It requires that a banking licence be obtained from the Minister of Finance before a financial institution can engage in banking business. Contravention of this requirement is an offence punishable by fine or imprisonment. Each application for a banking licence is investigated by the Central Bank, which then makes a recommendation to the Minister.

Some of the issues considered by the Act include:

1. Restrictions on the use of names containing the words "bank", "financial institution", "savings" and "loan";
2. Financial institutions are prohibited from undertaking certain fundamental changes within their business operations without obtaining the approval of the minister. Among the changes necessitating express approval of the minister are name changes, mergers and reduction of assigned or paid up capital;
3. Situations where a bank’s licence will be revoked;
4. Financial institutions maintaining a minimum level of paid up capital, reserve funds and specified assets;
5. Minimum requirements for the submission of information to the ECCB;
6. Examinations of licensed financial institutions to determine if they are in a sound financial condition and to ensure that they comply with the legal requirements;
7. The powers and measures available to the ECCB to prevent adverse consequences;
8. Minimum requirements for determining whether a person is fit and proper to be a shareholder, director or officer of a licensed financial institution;
9. Prudential Guidelines;
10. Abandoned property;
11. Receivership, liquidation and reorganisation issues; and
12. Transfer of Banking Business

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