That SVG’s international finance sector would operate with integrity and reputability and thereby contribute to economic and social development is the vision of the International Financial Services Authority (IFSA).
In early 2004, IFSA reports that this vision is beginning to find true expression. {{more}}
In real terms the new year has seen a growth in the registration of international business companies (IBCs) of 84 per cent up from the previous year. By the end of April some 357 new IBCs had registered, compared to 194 in 2003. The rate of renewals of existing companies is just a fraction higher than it was last year. The renewal rate is a very important indicator of the degree of sustainable business. The year-to- date income of the Authority for April 2004 is $1,802,662.30 compared to the year-to-date figure for April 2003 of $1,345,124.57; an increase of near half a million dollars.
Looking back, the full weight of the negative listing of SVG had its greatest impact in 2003 with a drop in revenue of approximately $1 million. It is for this reason that the work of the National Investment Promotions Inc (NIPI) was so timely in spreading the news that SVG is off the black list. In just six months after the coming on stream of NIPI, the word has gotten out and people are once again considering SVG as a credible jurisdiction in which to invest.
Areas of promise in the sector are in IBCs, international private banks and insurance and mutual funds. As indicated above, the growth in new IBCs for the year has been very high (84 per cent). The Authority is confident that the small international private banking sector here will strengthen. The international banks (formerly called offshore banks) now employ some 41 Vincentians; this figure excludes professionals engaged to perform specific services (e.g., accountants and lawyers).
Internationally there is a growing demand for “designer” or more exclusive private banks. There is disenchantment with the lack of personalized customer services offered by commercial banks onshore, where automation has gone too far. International private banks are offering personalized and more diversified services, including asset management and the offer of higher rates of return, not readily available in mainstream high street banks. The new International Banks Act will further spark the growth of this sector as it contains many investment friendly provisions.
The year 2004 has also seen the licensing of two new mutual fund entities and five new international insurance companies. The Authority has seen much interest, both in terms of inquiries and new applicants in these two sectors. The Authority is processing its first new banking application in two years. With ongoing training and the strengthening of its resources, IFSA is well equipped to regulate an expanding sector.
As a further incentive to growth, the Authority, in collaboration with the private sector, is conducting a fee review to ensure that our prices are competitive.
With a high standard regulatory regime in place, St. Vincent’s voice is now respected on the world stage, and here at home, real income generated by the sector as well as real jobs are on the rise.
Louise Mitchell, Executive Director (Ag) Intl. Financial Services Authority, May 17, 2004.