Financial crises occur around the world for many different
reasons and are often driven by instability in one of the many
financial sectors. When such a crisis occurs, one constant aspect
is that it has always brought a regulatory response aimed at
determining the cause and mitigating the probability of recurrence.
This concept held true in the Wall Street crash of the 1920s; the
banking run in the 1930s; the hyper-inflation crisis in Latin
America; the dot-com bubble crisis; the derivative market crisis
and the recent global economic crisis fuelled by contagion.
In similar fashion, the Financial Services Commission (FSC) in
Barbados was established as a response to turbulent economic times.
It was recognised that as a developing global financial centre,
Barbados needed to ensure it had a robust regulator in the non-bank
financial sector to help build and maintain stability in the
financial system. Deliberations on this matter began as early as
2004, and in 2011 a final decision was taken to combine the
functions of three regulatory bodies to create a new Commission,
with its main objectives being to:
Maintain financial stability
Nurture/build a sound business
environment that is conducive to growth.
Five years on, the FSC continues to develop as a robust
financial regulator. It has been able to attract a staff complement
of highly skilled professionals, many versed in the theories and
practices of risk management, economics and risk mitigation. They
remain insistent on quality output and have helped to establish a
growing, high-performance culture within the organisation. The FSC
has also been able to build a risk-based regulatory system
utilising its resources in the most efficient manner, to manage and
mitigate excessive risk-taking in the non-bank financial
Along with a strategic plan detailing its road map for
organisational growth, the FSC has identified core corporate
principles designed to help establish it as a high-quality
regulatory body that is constantly focused on becoming the best in
the world at what it does. This is achieved, to an even greater
degree, with the organisation building its own regulatory practices
on international best practices established by such bodies as:
IAIS (International Association of
IOSCO (International Organisation of
IOPS (International Organisation of
ICURN (International Credit Union
It has also integrated into its operations the recommended
practices of the Organisation for Economic Co-operation and
Development on exchange of information, and the Financial Action
Task Force's recommendations on anti-money laundering
The FSC is fast becoming a thought leader in the area of
financial regulation and currently sits on boards of directors and
sub-committees of various Caribbean and international regulatory
organisations. Of particular note, is the fact that it is now an
active member of the Group of International Insurance Centre
Supervisors, and as such, seeks to influence the policies set for
regulating captive insurance business globally.
In addition to building a robust regulatory framework, this
island's sole regulator of the non-bank financial sector
recognises the benefits of working with key stakeholders to
understand their various operations. It has therefore embraced
transparency and dialogue with the regulated entities and their
representative groups, as a demonstration of the fact that this
approach is central to creating an environment conducive to
well-managed growth in these sectors.
The FSC is excited about its achievements thus far. It is even
more excited about the future of financial regulation in Barbados
and the part the organisation will play in this development. It is
keen to ensure that it continues to nurture an environment
conducive to positive growth, both in Barbados' domestic
financial sector and in the international business and financial
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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Now that the United Kingdom has served notice to leave the European Union under Article 50 of the Lisbon Treaty, managers of offshore funds have a clearer timetable for when Brexit will happen, with the UK scheduled to leave the EU in March 2019.
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