• Follow us

Economy

Bermuda Monetary Authority: 50 Years Later - Bernews

[Bermuda Monetary Authority series]

As the Bermuda Monetary Authority [BMA] celebrates 50 years in 2019, we take a look back at the last five decades. From providing sound policy advice to pushing Bermuda forward as a reputable place to conduct business, the BMA has had an incredible impact on Bermuda’s financial landscape.

1990-1999

Exchange Controls/Anti-Money Laundering Initiatives

Expansion of Duties

The third decade of the Bermuda Monetary Authority [BMA] saw further advances in broadening the BMA’s powers. The Bermuda Monetary Authority Act 1969 was amended to enable the BMA to supervise, regulate and inspect specified financial institutions by giving statutory backing to its involvement in processing applications for the incorporation of companies and the formation of partnerships, as well as the issue of permits to foreign companies. Whilst this function had previously been carried out by the BMA voluntarily, the need for permission to be given under the Exchange Control Act 1972 for the issue and/or transfer of shares to non-residents required the BMA to be automatically involved in many of the previous applications.

By 1992, there were 7,022 exempt companies registered in Bermuda, of which 19 percent were insurance companies. The BMA was also physically expanding due to its new responsibilities, and in 1990 the BMA left the Government Administration building and moved into the first floor of Sofia House across from the Cathedral on Church Street. The move symbolically underlined the BMA’s constitutional separation from the Government.

By 1991, as the organisation continued to expand its duties, there came a need to reorganise into five divisions and a Policy and Research Unit. The five divisions created were the Administration Division; Domestic Economy Division; Companies, Partnerships and Permits Division; Financial Services Division; and the Exchange Control Division.

Relaxation of Exchange Control

Whether or not to relax Exchange Control was still a predominant conversation throughout the early part of the 1990s. Two of the main concerns regarding relaxing Exchange Controls were [i] accepting international interest rate structures, and [ii] the stability of the Balance of Payments would have to be brought about by the development of other control devices.

The tide had begun to turn and whilst it was noted that Exchange Control had achieved some benefits, including orderly management of the inflows and outflows of currency that had helped with the development of Bermuda, the BMA believed it had clear downsides. One downside was that it had become more challenging to present Bermuda as part of the modern financial community whilst retaining outdated methods like Exchange Control.

According to Mansfield Brock, CBE, who was the BMA’s Chairman from 1993 – 1999 and worked closely with former Premier and Finance Minister the late Dr. David Saul to gradually phase out Exchange Control restrictions, a foreign currency regime was bad for Bermudians. “It limited our freedom to invest, and with the rigid interest rate ceiling of 7 percent at the time, Bermudians could not benefit from the worldwide growth by investing in currency and companies worldwide.”

He continues: “I knew the regulations very well because I had been Bermuda’s Financial Secretary. I knew the Controller [of Foreign Exchange] could get rid of this without any change in legislation and Cabinet approval. We got together with the Minister of Finance and said we want to gradually do away with Exchange Control over a period of time without fanfare and with no announcements. We just gradually eased the restrictions. The Controller would give permission in areas where he felt permission would benefit the country.”

Whilst the Exchange Control Act was never repealed and is still written into law today, by 1997, the BMA no longer had involvement in the administration of Exchange Control relating to monetary exchange transactions.

Worldwide Supervision Increases

Whilst Exchange Control went through gradual relaxation, the supervision and regulatory environment worldwide only became more stringent. The groundwork that the BMA had laid in 1989 proved beneficial with an amendment to the Bermuda Monetary Act 1969. The amendment in 1990 intended to build a robust and comprehensive legislative framework covering the supervision of banks, deposit companies, the credit union and collective investment schemes or ‘financial institutions’ in Bermuda. The amendment was the first step to bring local banks within the internationally accepted and practiced standards of supervision set down under the Basel Accord of 1988.

With the Basel Accord for banks internationally accepted, the BMA was continuing to move to meet international standards for supervising financial institutions locally. Questions directed to the BMA from foreign regulators/institutions regarding Bermuda’s system of supervision reflected growing concerns within the global financial sector over the management of risks. Likewise, the formulation of adequate regulatory measures to ensure investor protection locally was also becoming more imperative.

In 1990, Bermuda was formally welcomed as a full member of the Offshore Group of Banking Supervisors, having earlier been accepted into the Caribbean Banking Supervisors’ Group. The Offshore Group of Banking Supervisors liaised directly with the Basel Committee and represented a major step for Bermuda towards consolidating status as a stable financial jurisdiction.

As part of the Basel Agreement, in 1993, Prudential Information Returns were introduced. The forms were completed quarterly for banks to provide a breakdown of the bank’s balance sheets. Analysis of the statistical information provided by the banks, combined with regular prudential meetings, provided the basic framework for supervision in Bermuda.

The threat of money laundering had begun to rear its head and in 1990, a representative from the BMA attended the Conference on Economic Crime held in Barbados. Concerns over money laundering were highlighted and attendance proved helpful with assisting in the detection of criminal activities and taking better measures to protect Bermuda from such actions.

In the latter part of the decade, more inroads were made in terms of combating money laundering with the passing of the Proceeds of Crime Act 1997, which encompassed money laundering offences and penalties. In 1998, the National Anti-Money Laundering Committee was established to advise the Government on the development and implementation of policies and activities to combat money laundering. The BMA introduced the Anti-Money Laundering Internal Control Procedures through its Policy, Research and Statistics Division, which was designed to regulate anti-money laundering procedures within the Authority.

By the early 1990s, the BMA now had authority to supervise further financial institutions with the introduction of the Trust Companies Act 1991. The Act provided the licensing system and the supervisory framework for trust companies and the inclusion of trust companies as financial institutions under the Bermuda Monetary Authority Act 1969.

A Formal Stock Exchange

In 1992, the Bermuda Stock Exchange Company Act was passed, with the recognition that the existing local Exchange needed to be transformed into a properly regulated, modern, electronic exchange on which international companies could be listed. By 1993, the Bermuda Stock Exchange [BSX] had attracted listings of over 30 international mutual funds. The Exchange was established as a self-regulatory body, but an amendment was made to the Bermuda Monetary Authority Act 1969 to add the Stock Exchange as a financial institution subject to supervision, regulation and inspection by the BMA.

Peter Sousa, who worked for the BMA from 1986 – 1997, adds, “What the Stock Exchange Company Act of 1992 did was put in place a proper structure, proper governance, proper regulatory reporting and responsibility. It took a sleepy trading system, structured it and formalised it in a way that it could be more effective domestically, but also recognised internationally. This was all part of Bermuda being seen as a respected and credible international financial centre.”

Later that year, the BMA gained full membership in the International Organization of Securities Commissions [IOSCO]. IOSCO’s primary goal was to develop the broadest possible international consensus on regulatory matters relating to the integrity of markets, efficiency of cross-border capital formation and protection against fraudulent activity.

New Displays for Bermuda’s Notes & Coins Collection

Exciting developments for the numismatic division of the BMA saw a permanent exhibit of Bermuda’s history of notes and coins open in 1992 at the Bermuda National Museum, formally the Bermuda Maritime Museum. The opening coincided with the issuance of a new $50 currency note, which featured a sketch of the Santa Lucia ship that wrecked off the reefs of Bermuda in 1584 on one side and on the other side the Commissioner’s House.

A Note & Coin Exhibit to mark the BMA’s 25th Anniversary was unveiled by Sir Eddie A. George, former Governor of the Bank of England, at the offices of the Corporation of Hamilton at City Hall. During his time in Bermuda, the Governor also unveiled a commemorative plaque at the BMA office at Sofia House, along with other 25th Anniversary Commemorative items. In March of 1992, the BMA’s General Manager, Malcolm Williams and Deputy General Manager Marcia Woolridge-Allwood, presented Queen Elizabeth II number 1 of the $100 gold proof coins commemorating her visit to Bermuda with the Duke of Edinburgh.

Archaeological Dig Uncovers Hogge Money

During the summer of 1994, employees of the BMA took part in an archaeological dig on Castle Island in Castle Harbour. The dig, co-led by Dr. Edward Harris, former Director of the Maritime Museum, involved visiting university students from Virginia’s College of William and Mary. Mr. Sousa recalls “Quite a number of pennies, shillings, threepence and sixpence were discovered.” But the most exciting discovery that day, recalls, Leanora Stovel-Smith, one of the BMA’s longest serving employees, was the moment she uncovered a piece of ‘Hogge Money’ – some of Bermuda’s oldest money that dated back as early as the 1600s. “We were told there was a possibility we might find something, but I was surprised. As I dug and I felt something hard, I said, ‘I think I found something.’ I couldn’t believe it, but it ended up being a piece of Hogge Money” Mrs. Stovel-Smith said.

In 1997, having purchased and moved into its new premises at the former “Shutters Building” on Burnaby Street, the BMA held a reception to honour the occasion. The reception also marked the official opening of the Hogge Money display pieces, which were part of the “Castle Island Collection” and recognised as the most authentic group of Hogge Money coins in existence. Earlier that year, a permanent exhibit of Bermuda’s notes and coins had been established at Burnaby House during the official opening of the BMA’s new premises.

That same year, the BMA published the book “Coins of Bermuda,” edited by Mr. Sousa, General Manager Malcolm Williams and Dr. Edward Harris. This reference book was a product of six years’ of research, and describes and illustrates Bermuda’s vast numismatic heritage.

By the end of the decade, the BMA restructured its departments into five divisions: Administration; Authorisation & Compliance; Deposit-Taking Institutions; Investment; and Policy, Research & Statistics. This organisational change reflected new legislation that was to come into effect in 2000 in regards to the Banks and Deposit Companies Act 1999 and the Investment Business Act 1999.

Share via emailRelated Stories

Read More About

#BermudaBusiness #BermudaMonetaryAuthority

Category: All, Business

Read More



Leave A Comment

More News

Business

Lay financial foundations before investing 2019-09-21 08:00:00Dear Dave,My husband and I are in our 30s. We have $15,000 in debt spread across student loans, credit cards, and a car payment. We make decent money,

HSBC shares fall 0.65% on BSX 2019-09-20 17:40:00Shares of HSBC Holdings fell 0.65 per cent in Bermuda Stock Exchange trading.The international bank's locally listed shares dipped five cents to clos

Fireminds assists customers after storm 2019-09-20 14:15:00In the wake of Hurricane Humberto, IT company Fireminds is offering recovery space for offices damaged by the storm.This morning the company said they

Humberto brings disruption to businesses 2019-09-20 08:00:00Hurricane Humberto's wrath was felt at Boaz Island Marine Service Station on Malabar Road in Sandys Parish.The station was closed yesterday due to th

Butterfield shares dip 1.6% in New York 2019-09-20 08:00:00The Bermuda Stock Exchange was closed yesterday, as a result of the disruption caused Hurricane Humberto's visit to the island.The Royal Gazette/BSX

Huff: Bermuda can be a leader in cyber 2019-09-20 08:00:00The emergence of cyber-risk is prompting insurance companies to move beyond pure indemnification of loss costs, the president of the Association of Be

Estera appoints Patel to top sales role 2019-09-20 08:00:00Estera, a provider of corporate administration, funds and trust services, has appointed Sonal Patel as managing director, head of sales - Americas, Be

BSX CEO bullish on ILS 2019-09-20 08:00:00Market-leading Bermuda remains the natural location for the growth and development of the insurance-linked securities asset class, the chief executive

Rowing studio at heart of Court House revamp 2019-09-19 08:00:00Court House Squash and Wellness has completed a $1 million-plus renovation that includes the unveiling of Bermuda's first indoor interactive rowing s

Bespoke Analytics to host free showcase 2019-09-19 08:00:00Data services and business intelligence solutions firm Bespoke Analytics is to host a free, educational showcase to show local companies how quickly t

Schrum named among 'global elite' 2019-09-19 08:00:00Appleby partner Vanessa Schrum has been recognised as among the leaders in her practice area in the Private Client Global Elite Directory published by

Butterfield's US shares surge 4.2% 2019-09-19 08:00:00No stocks traded during a shortened day on the Bermuda Stock Exchange yesterday.The Royal Gazette/BSX Index remained unchanged on 2,084.37 as the BSX

Bernews.com » Business

BTA: Bermuda Is ‘Open For Business’ 2019-09-19 15:00:29Last night, Hurricane Humberto passed by Bermuda, but ”Bermudians have plenty of experience in dealing with weather events”  &nd

Clarien Bank Resumes Normal Operations Friday 2019-09-19 12:12:41Clarien Bank Limited will resume all business operations post Hurricane Humberto on Friday, September 20. The Hamilton and Paget Plaza locations will

Athene Announces Pricing Of Public Offering 2019-09-19 05:24:11Athene Holding Ltd. [Athene] announced the pricing of its public offering of 12,000,000 depositary shares, each representing a 1/1,000th interest in i

Bermuda Stock Exchange Report: Sept 18 2019 2019-09-19 05:15:12September 18 saw 0 shares trade on the Bermuda Stock Exchange. The BSX finished at 2,084.37, even on the day. There were 0 advances, 0 declines, and 5

Freisenbruch-Meyer’s Offices Will Close Today 2019-09-18 10:22:58Freisenbruch-Meyer’s offices will close today [Sept 18] at 12.00pm and will reopen at the earliest at noon tomorrow [Sept 19], the company said.

Brenton Slade Named As President Of Lodgepine 2019-09-18 09:54:35Markel Corporation has hired Brenton “Brent” Slade as president of Lodgepine Capital Management Limited, its new retrocessional Insurance

Princess ‘Prepared & Ready’ For Hurricane 2019-09-18 09:44:14Hamilton Princess said they are prepared and ready for Hurricane Humberto, and as part of its preparations, will be closing its restaurants and f

BSX To Close Due To Hurricane Humberto 2019-09-18 09:11:18Due to the approach of Hurricane Humberto, the Bermuda Stock Exchange [BSX] and the market will close at noon today [Sept 18] and will also be closed

Court House Unveils Major Club Upgrades 2019-09-18 08:18:46Court House Squash & Wellness has completed a major renovation that includes an interactive rowing studio with Technogym Skillrow machines and tec

Tucker’s Point Hosts Real Estate Industry Fete 2019-09-18 06:25:24Buddy Fleming, Director of Sales and Marketing, at Tucker’s Point Real Estate, welcomed the Bermuda real estate community and its esteemed partn

Oct 2: Bespoke Analytics’ TimeXtender Showcase 2019-09-18 05:39:37Bespoke Analytics will be hosting a free educational TimeXtender Showcase on Wednesday, October 2 at BUEI. A spokesperson said, “Local company B

Bermuda Stock Exchange Report: Sept 17 2019 2019-09-18 05:15:17September 17 saw 2,002 shares trade on the Bermuda Stock Exchange, valued at $60,535.00 BD. 2,002 shares were traded by Bank of N.T. Butterfield Ltd,

Reuters: Business News

Factbox: Key dates in the history of tour New! 2019-09-22 14:55:04The bosses of Thomas Cook , the world's oldest travel company, were meeting lenders and creditors in London on Sunday to seek a last-ditch deal to sa

Travel group Thomas Cook battles for survival ahead New! 2019-09-22 14:55:04The British government has plans in place to bring home stranded holidaymakers if Thomas Cook goes out of business, an event that would likely spark

Thomas Cook customers say hotel in Tunisia stopped New! 2019-09-22 14:55:04British tourists in Tunisia said their hotel stopped them leaving for several hours on Saturday night over concerns about payment by their holiday ope

Some WeWork directors considering removal of Adam Neumann New! 2019-09-22 14:20:07Some WeWork board members, including officials tied to SoftBank Group Corp , are planning to try to push Adam Neumann to step down as chief executive,

Banks worth $47 trillion adopt new U.N.-backed climate New! 2019-09-22 14:07:49Banks with more than $47 trillion in assets, or a third of the global industry, adopted new U.N.-backed "responsible banking" principles to fight cl

Huawei denies interest in acquiring Oi or any New! 2019-09-22 13:18:49Chinese telecoms equipment maker Huawei Technologies Co said on Sunday it was not interested in acquiring struggling Oi SA or any other Brazilian car

Vivendi set to widen legal battle against Mediaset New! 2019-09-22 12:36:17Vivendi is taking steps to widen its legal battle against Mediaset beyond Italy, in a move that indicates the French media group has not liquidated

Deutsche Bahn sees big windfall from climate change New! 2019-09-22 09:18:08Germany's Deutsche Bahn [DBN.UL] expects the government's 50 billion euro climate change package to generate the railway company's biggest growth s

Big companies commit to slash emissions ahead of New! 2019-09-22 07:05:43Almost 90 big companies in sectors from food to cement to telecommunications are pledging to slash their greenhouse gas emissions in a new campaign t

Saban to return controlling stake in Israel's Partner New! 2019-09-22 07:04:17U.S.-Israeli media magnate Haim Saban plans to give up his controlling stake in Israeli mobile phone operator Partner Communications , financial media

Eyes on U.S. prize, Primark considers Central American New! 2019-09-22 07:02:24Confident it can crack the $300 billion U.S. clothing and shoes market where many other foreign retailers have failed, Britain's Primark is ready to

No one will be stranded, UK minister says New! 2019-09-22 06:58:05British foreign minister Dominic Raab said the government had contingency plans in case talks to rescue travel company Thomas Cook fail, and sought to

Business - The Huffington

MoviePass Shuts Down Its Service After Years Of 2019-09-13 16:50:12MoviePass' parent company appeared unsure if it the movie ticketing service would ever be restored.

Possible Strike Looms At General Motors 2019-09-13 14:48:23The United Auto Workers union and GM will hit a negotiating deadline this weekend, just as the union faces more embarrassing corruption news.

It Takes A Village To Create Sustained Institutional 2019-09-12 10:45:38Strengthening tomorrow through diversity and inclusion starts with us today.

Lyft Updates Safety Policies Amid Sexual Assault Lawsuit 2019-09-10 18:02:38An attorney representing 14 women who say they were assaulted by Lyft drivers called the company's updated policies a "cheap public relations stunt.

Why CEOs Are Failing At Inclusion — & 2019-09-10 08:56:52“You can’t be an ally or advocate unless you’re willing to take action. Even micro-actions can make an impact.”

New York To Investigate Facebook Over Possible Antitrust 2019-09-06 11:23:41The joint probe with several other states will look at how the social media giant's market dominance affects user data, consumer choice and the price

How Amazon Hooked America On Fast Delivery While 2019-09-05 13:20:17Our investigation found Amazon escapes responsibility for its role in deaths and serious injuries even though the company keeps a tight grip on how th

4 Ways To Incorporate Diversity Into Your Workplace 2019-09-05 09:27:04“We have made progress over the last half-century in terms of diversity and inclusion. … But the work is far from done.”

14 Women File Lawsuit Against Lyft After Reporting 2019-09-04 23:34:16At a news conference, one woman recounted a horrific kidnapping and rape that she said took place after she summoned a Lyft ride using its app.

YouTube To Pay $170 Million Fine After Violating 2019-09-04 14:04:18The settlement follows allegations that the video service collected children's personal data without their parents’ consent.

Navigating The Road To Education & Workplace Success 2019-09-03 16:28:13“Even if you make it to college, there’s a real chance you won’t make it to graduation. We need to rethink the systems that result i

Bugatti Chiron Smashes Through 'Inconceivable' Speed Record 2019-09-02 22:52:01The car broke through the 300-mph barrier during a test run last month.

Christian Science Monitor |

Agricultural companies look to enter growing fake-meat market 2019-09-09 14:30:01Traditional agricultural companies are investing in the surging fake meat market, which some predict will triple in size over the next decade.

Volkswagen invests on new electric model. Will consumers 2019-09-09 12:16:38Carbon regulations are pushing EU auto companies to invest in electric vehicles, but so far only customers in wealthy countries are interested.

Why Albertsons says guns and grocery shopping don't 2019-09-09 05:45:46Supermarket operator Albertsons Companies joined Walmart, Kroger, and other retailers asking customers not to openly carry firearms while shopping.

China and industrial theft: What U.S. history says 2019-09-04 16:50:00The U.S.-China trade war ratcheted up Sept. 1 with new tariffs. Lessons from the U.S.’s commercial rivalry with Britain 200 years ago still reso

Capitalism under pressure: Why CEOs rethink corporate purpose 2019-09-03 16:16:00When 181 CEOs at the Business Roundtable’s revised their view of a corporation’s purpose, it reflected social changes since the Great Rece

Why carmakers are revving for regulation 2019-08-27 16:27:33A Trump proposal to scale back fuel efficiency standards has several key automakers siding with environmentalists in California.

The other economic trajectory: Global poverty in decline 2019-08-26 17:15:00Often the media focus on economic challenges, such as inequality and poverty. That’s important, but so is taking note of real progress.

As China trade war escalates, Iowa soybean country 2019-08-23 16:40:10For soybean farmers, weather is “an uncontrollable.” Now President Trump’s fight with China is, too.

Home Page

Onion shoots up to Rs 70-80 per kg; New! 2019-09-22 04:42:18Onion prices are on the rise despite several measures taken by the central government to boost supply

RCap's $13-bn debt at risk on default rating, 2019-09-22 04:30:48The default rating is set to exacerbate a yearlong credit crunch among India's shadow lenders, which started with the collapse of IL&FS Group las

Trump may deliver 30-minute speech: What to expect 2019-09-22 04:05:07Trump is also expected to be present in the audience during Prime Minister Narendra Modi's address

PM Modi meets energy sector CEOs in US, 2019-09-22 01:41:46PM also witnessed the signing of MoU between US natural gas company Tellurian Inc. and Petronet LNG of India after

Banking, FMCG to gain from tax cut; pharma, 2019-09-22 01:32:44Giving a sectoral analysis of the impact of tax cut, ICICI Direct Research said domestic auto equipment makers will tend to benefit from the tax cut

FPIs withdraw Rs 4,193 crore from capital markets 2019-09-22 01:31:12Foreign portfolio investors withdrew a net amount of Rs 5,577.99 crore from equities while infusing Rs 1,384.81 crore into the debt segment

361 infra projects show cost overruns of over 2019-09-22 01:04:29The average time overrun in these 496 delayed projects is 36.98 months

In biggest recruitment drive, Railways hires over 10,500 2019-09-22 00:52:41Out of the 1,120 sub-inspectors recruited, 819 are men and 301 women

Govt had a chance to strengthen the economy 2019-09-22 00:17:32The amount coming from toll tax is also not more than Rs 7,000 crore, he noted

Google honours mountaineer Junko Tabei with doodle on 2019-09-22 00:06:12Apart from the mountains, the doodle also shows a moving animated cartoon representing Tabei

Babri Masjid case: CBI court issues summons to 2019-09-21 23:22:19All the accused are on bail in the case, which is being conducted on a day-to-day basis, on the directions of the apex court

Petronet signs MoU with US natural gas firm 2019-09-21 22:53:50Tellurian and Petronet will endeavour to finalise the transaction agreements by March 31, 2020


Disclaimer and Notice:WorldProNews.com is not responsible of these news or any information published on this website.