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Oct 29, 2002

Fifth offshore bank opens

Forget the Caymans; bank in Belize. That’s the message government is sending to the world of international finance. The occasion was the official opening of Belize’s newest offshore institution, the Investment and Commerce Bank Limited. Speaking at ceremonies on Friday night, Minister of Budget Management Ralph Fonseca applauded the development of the offshore banking sector, which has grown from one bank, with one point three million U.S. dollars under management in 1998, to five banks and one hundred and sixty-four million dollars today. In addition to Investment and Commerce, which is owned by Guatemala’s Banco del Quetzal, Belize’s other offshore banks include Provident, which is owned by investors from Belize and Antigua, Atlantic International, an affiliate of Atlantic Bank Limited, and Oxxy Bank, owned by Guatemalan’s Banco de la Republica. These are class “A” banks with unrestricted licenses. The fifth bank, Market Street Bank, is a class “B” institution which is restricted to doing business solely with its twenty-five U.S. based owners. Under Belizean law offshore banks are not allowed to do business with residents of Belize, although recent legislation has expanded the definition of “non-resident” to include the government as well as entities located within free zones and export processing zones. The primary benefit to the country from offshore banks is official fees, rents and a small amount of skilled employment. The international banking industry has come under increasing pressure from the U.S.A. and European authorities who see it as a haven for money launderers and tax evaders. Proponents of the industry point out that the vast majority of customers doing business with offshore banks only seek to keep their assets safe from the prying eyes of greedy governments and the sharp teeth of hungry spouses. In Belize the job of policing the offshore sector falls to government’s Financial Intelligence Unit, headed by former Central Bank Governor Keith Arnold. According to Arnold, his office closely monitors the movement of offshore funds and any hint of a crime would immediately trigger an investigation into the bank in question. Since the introduction of offshore banking laws in 1996, more than two dozen applications have been processed. Only the five banks mentioned have been granted licenses.

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