INVEST IN ST Kitts & Nevis - Banking
St. Kitts and Nevis is one of eight members of the Eastern Caribbean Currency Union (ECCU), the organization responsible for maintaining economic and banking policies in the Federation. There are several commercial banks located on St. Kitts and Nevis. These include the Eastern Caribbean Central Bank, St. Kitts-Nevis-Anguilla National Bank, Bank of Nevis, and some branches of foreign incorporated banks, including First Caribbean International Bank, Bank of Nova Scotia, and Royal Bank of Canada.In quarter four of 2010, the largest commercial bank in the ECCU, National Bank,reported over two billion dollars in assets.
St. Kitts and Nevis has maintained great diplomatic relations with several countries, including the United States, France, the United Kingdom Russian, Cuba, Canada, South Korea, and several Latin American countries. The Federation is diplomatically active, and is a member of several organizations, including the Commonwealth of Nations, the United Nations, the World Bank, and the International Monitory Fund. Its currency, the East Caribbean dollar, is directly tied to and has maintained a fixed exchange rate of 2.7 to the US dollar.
The Eastern Caribbean Currency Union (ECCU) has imposed a strong regulatory framework that contains two primary legislative components, including the Eastern Caribbean Central Bank (ECCB) Agreement Act, and various Banking Acts independent to each territory. The purpose of these regulatory legislations is to maintain the performance of banking institutions and strengthen the overall financial system. Currently, commercial banks and any institutes offering banking services must be regulated by the ECCB and be appropriately licensed. In addition, they must submit returns to the ECCB on a monthly, quarterly, and annual basis. Throughout the years, these legislations were reformed to promote stricter regulations, and in effect, strengthening the overall banking structure and financial system in the Eastern Caribbean.
St. Kitts and Nevis’ banking system currently accounts for 352 percent of the country’s Gross Domestic Product (GDP) in assets. This sector is well capitalized and accounts for 20 percent of the total assets of the Eastern Caribbean Central Union (ECCU) banking system. The Federation’s 46 percent capital adequacy ratio far exceeded the Eastern Caribbean Central Bank (ECCB)’s regulatory requirement of eight percent. In addition, at the end of 2010, the banking sector’s overall net liquid assets ratio stood at 42 percent – also significantly higher than the ECCB’s requirement of 20-25 percent. In addition to its banking system, the country also has a large financial sector outside of banking that is comprised of credit unions (assets of 10.2 percent of GDP), insurance companies (assets of 44.4 percent of GDP), money services companies, an offshore bank, a development bank, a finance company, and a mortgage company.