Banks and Trust Companies (Amendment) Act, 2022

Summary

This Act amends the Banks and Trust Companies Act, Revised Edition 2020 (BVI), introducing a bank resolution framework, a new bridge bank licence category, deposit insurance related obligations, and other changes to licensing and audit reporting requirements. It comes into force on a date to be appointed by the Minister via Gazette notice, not automatically on passage.

• Resolution powers: The Commission may place a bank into resolution where necessary in the public interest to protect depositors and financial stability, and may exercise resolution powers under the Financial Services Commission Act.
• Bridge banks: A new licence category allows a bridge bank to temporarily take over the assets, operations and liabilities of a failed bank; such licences terminate under specified conditions and the bank is then placed into receivership and liquidation.
• Systemically important banks: The Commission may designate a licensee as a systemically important bank, triggering additional prescribed compliance requirements.
• Deposit insurance: New licence applicants for banking business must undertake to provide the Commission with a copy of their deposit insurance policy within 6 months of licence issuance; existing banks operating when the Deposit Insurance Act came into force have 6 months from that date to obtain and provide proof of a deposit insurance policy.
• Audit reporting: Licensees must forthwith notify the Commission if they receive a qualified audit report or one containing an auditor's emphasis of matter.
• Class III licence changes: Restricted Class III licence holders may provide directors, officers and nominee shareholders for both Virgin Islands and non Virgin Islands companies, subject to a cap of 500 companies administered and sanctions related restrictions on non VI companies.
• Controlling interest definition: The definition of controlling interest is broadened to include influence over a licensee's undertakings and situations where directors or senior officers act on a person's instructions.

The amendments primarily affect licensed banks and trust companies, including those newly licensed as bridge banks or designated as systemically important, and interact with the Virgin Islands Deposit Insurance Act and the Financial Services Commission Act.

Key obligations

• A person carrying on banking business must obtain a policy of deposit insurance under the Virgin Islands Deposit Insurance Act and provide a copy to the Commission within 6 months of the coming into operation of that Act
• An applicant for a banking licence must undertake in writing to provide the Commission with a copy of its deposit insurance policy within 6 months of the issue of the licence
• A licensee that receives a qualified audit report or one containing an emphasis of matter must forthwith notify the Commission
• A bridge bank whose licence is terminated must forthwith surrender its licence to the Commission for cancellation
• A systemically important bank must comply with such other requirements as may be prescribed, in addition to existing statutory requirements
• A restricted Class III licence holder is limited to administering no more than 500 Virgin Islands and non-Virgin Islands companies

Applies to

banks, trust companies, bridge banks, systemically important banks, Class III licensees

Deadlines

• within 6 months of the issue of the licence: New banking licence applicants must provide the Commission with a copy of their deposit insurance policy
• 6 months from the date of operation of the Virgin Islands Deposit Insurance Act, No. 7 of 2016: Existing banking businesses must obtain deposit insurance and provide proof to the Commission
• such date as the Minister may by Notice published in the Gazette appoint: Commencement date of the Banks and Trust Companies (Amendment) Act, 2022

Related documents

• This document amends Banks and Trust Companies Act (Revised Edition 2020)