Evolution of the Financial Services Sector

The Bahamian government is prudently further enhancing its allocation of resources to the modernization of the financial services sector keeping pace with the digital footprint of the industry internationally, speed and efficiency. The legacy of financial services in The Bahamas is a rich history of more than 80 years to date and is here to stay.

The Bahamas is world renowned for its financial services industry in large part because of its inclusive and diverse financial products built on a robust and tested legislature. There are a plethora of professional entities and consultants locally, with specialized education and a vast experience in wealth management, banking and corporate services.

That being said, the 2018/2019 fiscal budget that was passed in the House of Assembly on June 18th, 2018 is an undeniable indicator of the government’s continued unwavering commitment to the industry. This governmental support further build on the legacy of The Commonwealth of The Bahamas being among the eldest, most stable democracies in the Western Hemisphere, boasting in excess of 280+ years of unobstructed parliamentary democracy.

The Honourable T. Brent Symonette, the Bahamas Minister of Financial Services, Trade and Industry and Immigration, in his contribution to the budget debate outlined plans to further accelerate the pace of Human Capital Development and to enhance the Ease of Doing Business. Both initiatives will facilitate a deliberate economic transformation toward a sustainable future for the country’s financial services sector as well as other elements of the Bahamian economy.

Equity Bank And Trust Bahamas remains fiercely committed to your success with consistency, prudence and leadership during this transformation.

“We must first be proactive in investing in human capital through education and diversity to achieve service quality that is second to none,” said Minister Symonette. “By improving our talent pool, we will ultimately increase efficiencies in the “ease of doing business” in The Bahamas.”

The highly skilled staff of Equity Bank And Trust Bahamas boast a deep trenched knowledge of financial services as a well as FinTech. The Human Resource Department regularly takes initiative to schedule staff for internal and external (local and international) trainings, seminars, lectures and conferences across the topics of compliance, financial technology, wealth management and legislative updates. The staff also impressively consists of several computer and software programmers lending an advantage to the comprehension and formulation of bespoke FinTech and Artificial Intelligence solutions and efficiencies for the benefit of clients.

In this regard he said the establishment of a “Centre for Excellence” for professional skills development in financial services in the region is a priority. He stated that: “Through a grant from The European Union (EU) facilitated by The Caribbean Development Bank (CDB) a roadmap was developed to enable us to demonstrate our commitment to educating and equipping our financial services workforce to meet and maintain quality standards in the provision of financial services through the Centre for Excellence. This project is envisioned as a public-private sector partnership to create a financial services ‘SMART CITY’ for education, research and development, and internship.”

It is particularly noteworthy that Equity Bank And Trust Bahamas supports the development of the human capital with The Bahamas through its Summer Internship program which gives students at the University of The Bahamas and Bahamian students studying at US and Canadian-based Universities, a paid opportunity to gain real world training and experience in private banking and wealth management.

Minister Symonette added that his Ministry also intends to work with the University of The Bahamas to integrate in its business program opportunities for research and internships. The Ministry of Financial Services will also work with the Ministry of Education to strengthen financial services education at the tertiary level.

Minister Symonette added, “We must realize that although we are an independent and sovereign nation, we exist in an interdependent, and integrated ever-changing global economy. This means that we must embrace and adapt to change this is the only way we will be able to create opportunities for ourselves. He went on to state that, “We must be innovative in our services and product offering while also putting in the framework for policy, and innovation that will foster flexibility for the creation of new products and services as well as investment in new areas of financial services.”

The Minister contended that the Bahamas brand is to represent a label of quality, creativity, innovation and technological advancement. “We live in a knowledge based era, where these things are the key to future advancement. We must develop a Financial Services Technology and Innovation scheme where research centres and innovation libraries can be bred for user experience, data science and machine learning. This is where technological advancement is, it is happening now and we have to embrace it.”

The commitment of the Government to education as the means for transformation was emphasized when in closing the debate on the 2018/2019 budget The Honourable Dr. Hubert Minnis, Prime Minister of The Commonwealth of The Bahamas announced that beginning in September 2019, all full time Bahamian students who meet certain entry requirements for the University of The Bahamas will receive free tuition. “This major investment in education will help scores of young people to realize their dreams as we build a more equitable society,” said the Prime Minister.

With respect to the ease of doing business, Minister Symonette noted that the ease of doing business touches across the whole economy of The Bahamas, but is of particular importance to the Financial Services sector. “There has been a lot of talk surrounding this issue, but the goal of eliminating unnecessary bureaucratic protocols and practices in our administration for daily business operations is coming to fruition,” he said.

He said while improvements in the business license process are in its infancy phase, the business license fee for new businesses have already been eliminated over the past year. “Already, we are seeing greater communication between departments where the provision of information between agencies is being streamlined,” he said. “This has enabled most of the transactions for obtaining a business license to occur in one place.”

In outlining some of the upgraded efficiencies brought forward by the government, Minister Symonette cited improvements and advances in the Registrar General’s Department, but there are plans to increase efficiencies even more to improve processes for turnaround time and accessibility of information.

He went on to highlight efforts to streamline the account opening process: “We are also looking at amendments to legislation coming from the Central Bank of The Bahamas, around making the process about Know Your Customer, Money Laundering and Terrorist Financing less regimented and more fluid, effectively making it easier to open accounts and transact business.”

In addition to the initiatives outlined above, the Government is also engaged in discussions with the Governor of the Central Bank on calls to relax exchange control and the Securities Commission of The Bahamas is also making amendments to the Investment Funds Act which will aid to enhance this service.

While taking steps to ensure that there is a cadre of professionals to support the sector and seeking to ensure that persons who choose to do business in The Bahamas do not encounter obstacles, maintaining the integrity of the jurisdiction also remains a priority for the Government. The Minister emphasized the Government’s commitment to keep abreast and compliant with global financial initiatives. Last year, The Bahamas signed the Convention on Mutual Administrative Assistance in Tax Matters and the Multilateral Convention and Competent Authority Agreement for the OECDs Common Reporting Standard on the Automatic Exchange of Information. The first exchanges will commence in September of this year. The Bahamas also became a member of the Inclusive Framework for the implementation of Base Erosion and Profit Shifting (BEPS) and is working assiduously to implement the BEPS minimum standards and to meet its commitments to the EU directives by the end of 2018.

Signing on to these initiatives sends a loud and clear message to our international counterparts that The Bahamas is serious in its commitment to adhering to international standards relative to tax compliance and cooperation.

Not only is The Bahamas the ideal location as it is in the same time zone as both Miami and New York, hence optimally situated to be an epicentre of business and investment activities for those considering to function in and nearby the Americas, but it has a government and financial services industry committed to keeping pace and taking leadership on all fronts from technology to business efficiency and financial integrity. ■