Bermuda, Financial Legislation, Commercial Banks

by Elliot Clark on December 25, 2008

Bermuda is not an international offshore banking center in its classical sense. Large international banks that conduct their operations in other offshore banking centers or provide ordinary commercial banking services are not permitted to register and operate in Bermuda for the population of Bermuda.

Currently four large local banks operate in Bermuda that own assets worth of $500 billion. Bermudian legislation requires that a bank operating in Bermuda must be 60% owned by a resident of Bermuda; however in practice this parameter was nearly 85% until 2004. This is a special measure imposed by the government of Bermuda to ensure that head offices of the banks will remain in Bermuda, staff at the offices will be mostly Bermudian and management of a bank Bermuda Offshore Bankingwill be also Bermudian.

Bermudian banks not only render commercial banking services to the local population, but also engage themselves in international business relations. Despite that foreign banks are not allowed to operate in Bermuda, exempted companies are permitted to deal with foreign banks in any currency.

Bermudian banks offer wide range of services that include investment management, investment in Bermudian mutual funds, letter of credit issuance and links to other offshore banking centers in the world. Bermudian banks have achieved same weight as other large and reputable banks in the world by handling large volume of funds on behalf of Bermuda’s exempted companies. All four banks operate same clearance system.

Bermudian government licenses and regulates offshore banking sector through Bermuda Monetary Authority. Bermuda does not have central bank, but instead Bermuda Monetary Authority is the supervisor of entire financial sector and part of the legislation that regulates this field is The Banks & Deposit Companies Act 1999 and The Banking Appeal Tribunal Regulations 2001.

Bermuda Monetary Authority is also responsible for licensing, regulating and supervising banks, insurance companies, deposit companies and investment field. In addition, authority is responsible for issuance and redemption of notes and coins and advising government on banking, financial and monetary issues.

Offshore banking institutions operating in Bermuda:

The Bank of Bermuda Limited
Member HSBC Group
6 Front Street
Hamilton HM 11
PO Box HM 1020
Hamilton HM DX
Tel: (441) 295-4000
Fax: (441) 295-7093

Bermuda Commercial Bank Limited
43 Victoria Street
Hamilton HM 12
PO Box HM 1748
Hamilton HM GX
Tel: (441) 295-5678
Fax: (441) 295-8091

First Bermuda Group Limited
Chevron House
11 Church Street
Hamilton HM 11
P.O Box HM 318,
Hamilton HM BX
Tel: (441) 295-5630
Fax: (441) 295-6263

The Bank of N T Butterfield & Son Limited
65 Front Street
Hamilton HM 12
PO Box HM 195
Hamilton HM AX
Tel. No: (441) 295-1111
Fax No: (441) 292-4365

Capital G Bank Limited
21 Reid Street
Hamilton HM 11
PO Box HM 1194
Hamilton HM EX
Tel: (441) 296-6969
Fax: (441) 292-1277

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