Discussion Paper - Potential Banking Models for Bermuda (June 2026)

Summary

This is a Discussion Paper from the Bermuda Monetary Authority exploring potential new banking models that could be introduced in Bermuda to modernise and diversify the banking sector. It is a pre-consultation stage document seeking stakeholder views on the relevance of various global banking models, not a proposal for immediate licensing or authorisation changes. Feedback received will inform a subsequent Consultation Paper with refined proposals to update the banking and deposit-taking regime under the Banks and Deposit Companies Act 1999 (BDCA).

Models under consideration

• Depositary and Custodian Banks: Wholesale institutions providing safekeeping, settlement and administration services for institutional clients, not the general public.
• Merchant and Investment Banks: Fee based advisory, underwriting, capital raising and M&A services, typically without deposit-taking.
• Brokerages and Broker-Dealers: Agency or principal trading services, including possible cash management account offerings.
• Digital Asset Banks: Banks specialising in custody, management and transaction of digital assets, potentially combining a banking licence with a Digital Asset Business Act 2018 licence, subject to Basel crypto asset exposure standards.
• International Agent and Representative Banks: Local intermediaries allowing foreign banks to offer services in Bermuda without establishing a full banking operation.
• National/Post Office Savings Banks and Development Banks: Publicly owned models aimed at savings mobilisation or targeted economic development financing, noted as requiring full government support and of uncertain viability given Bermuda's scale.

The paper poses numbered discussion questions throughout on the benefits, risks and disruption potential of each model, and invites broader feedback on other models or activities not covered. It explicitly does not address licensing or authorisation design, which will be considered later once banking models are further defined.

Key obligations

• Stakeholders wishing to comment must email feedback to banking@bma.bm by the closing date of 1 August 2026.

Applies to

banks, deposit companies, digital asset businesses, investment business licensees, prospective banking model applicants, industry stakeholders

Deadlines

• 1 August 2026: Closing date for industry and stakeholder comments on the Discussion Paper (60 day comment period).