Wednesday, October 27, 2010

IMF Publishes Report on BVI Financial System

In the beginning of this week, the International Monetary Fund (IMF) released the report named the Financial Sector Stability Assessment of the British Virgin Islands. Actually, this document became the summary of the IMF review of the regulatory regime in the BVI, which started with the IMF team visit to the British Virgin Islands territory in April 2010.

The purpose of the assessment was to make a thorough review of the financial systems in the British Virgin Islands and evaluate their stability. In the final report, the IMF experts recognised the strength of the territory's regulatory regime and willingness and ability of the Financial Services Commission to be a partner in international cooperation and sharing of information.

The review of the International Monetary Fund included the financial system stability assessment, detailed assessment of Basel Core Principles for Effective Banking Supervision, technical notes on corporate and trust services providers and on mutual funds regulation. To conduct this review, the IMF team met with government representatives and agencies, among them the FSC and Financial Investigation Agency, as well as with local trade association representatives and industry practitioners.

According to the report, the regulatory framework for both onshore and offshore financial services in the British Virgin Islands is clear and comprehensive, and “the FSC has demonstrated its strength and independence as a regulator”. It is also noted in the report that the BVI has “solid legal basis for an effective banking supervisory regime, particularly after the recent enactment of the Regulatory Code, 2009.”

It was highlighted in the report that the BVI has quickly adopted international standards and significantly strengthened its supervisory function. The IMF noted that the territory's ability to attract business relies on its international reputation as a well regulated and policed jurisdiction with a strong legal framework and efficient corporate services.

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