Development Bank Law (2018 Revision)

Summary

This is the consolidated 2018 Revision of the Development Bank Law, which establishes the Cayman Islands Development Bank as a body corporate and sets out its governance, functions, and financial powers. It replaced the former Agricultural and Industrial Development Board and the Housing Development Corporation, transferring their powers, assets, staff, pension schemes and loan agreements to the new Bank. The law is primarily an organisational statute for this specific statutory development bank rather than a general rulebook for privately regulated financial institutions.

• Governance: The Act sets up a Board of Directors (mostly Cabinet-appointed, with non-voting ex officio government members), a general manager as CEO, and rules on delegation of Board functions.
• Powers and functions: It gives the Bank broad powers to accept deposits, make loans and provide credit, equity or advisory support to promote economic development (agriculture, industry, tourism, housing, education, etc.), subject to Ministerial policy directions and Cabinet oversight on borrowing and guarantees.
• Integrity restrictions: It prohibits loans to directors, Legislative Assembly members or their immediate family/controlled entities, and bars certain office-holders from acting as personal guarantors for Bank loans.

The law also addresses the Bank's finances, including authorised capital, funds, borrowing powers, and government guarantees requiring Legislative Assembly approval. It provides for regulation of the Bank by the Cayman Islands Monetary Authority (sections 23-25, headings only visible in this extract), plus general provisions on liabilities, disclosure restrictions, offences, regulations and transitional arrangements from the predecessor bodies.

Because a large middle portion of the document (covering accounts, annual reporting, CIMA's regulatory powers, offences, and full transitional details) was not available in this extract, some obligations under those sections could not be verified in detail.

Key obligations

• The Bank must not grant a loan to a director of the Board, a member of the Legislative Assembly, a body corporate/unincorporated body controlled by such a person, or their immediate family (spouse, son or daughter).
• Members of the Legislative Assembly, Board directors, and senior employees of the Bank are prohibited from acting as personal guarantors for a loan from the Bank.
• The Bank may only borrow money, raise capital, obtain/provide credit, or issue bonds/debentures with the approval of the Cabinet, which may impose conditions.
• A government guarantee of the Bank's borrowing may only be given after a statement of the proposed guarantee is laid before and approved by resolution of the Legislative Assembly.
• After a guarantee is given, the Minister must lay a statement of the guarantee before the Legislative Assembly, and annually thereafter until the guaranteed sum and interest are fully discharged.
• Every delegation of the Bank's functions must be made in writing and remains revocable by the Bank.
• The Board must give the Minister such information or advice as the Minister requires regarding the Bank's performance of its functions, and must conform to the Minister's general policy directions unless compliance would be commercially unsound and no Cabinet reimbursement undertaking has been given.
• Employees, pension schemes, assets, land, and outstanding loan agreements of the former Agricultural and Industrial Development Board and Housing Development Corporation are deemed transferred to and continued by the Bank.

Applies to

Cayman Islands Development Bank, Board of Directors of the Bank, Government of the Cayman Islands (Cabinet/Minister), former Agricultural and Industrial Development Board and Housing Development Corporation (transitional)