rates and overseas investent taxes: Bermuda's banks have $1.7 billion in Bermuda dollar deposits, cash which could disappear abroad with liberalisation.

Bermuda will have no shield protecting its unique economy and the Bermuda dollar will become subject to overseas interest rates and fortunes of overseas economies.

Bermuda's 60-40 rules on company ownership will "inevitably'' be abolished, leading to control of local companies by foreigners who are not committed to Bermuda, but to the bottom line.

Bank foreign currency lending will be determined by perception of economic and political stability.

There could be a potential shortage of mortgages and domestic loans following the dropping of controls, and a rush of cash abroad, resulting in a decline in the value of share prices and real estate values.

Bermuda banks could be absorbed into international banking. Local banks may find profitable international banking business is eaten away by foreign banks, which may lead to Bermuda's banks shrinking in size, laying off staff and less efficient domestic banking facilities.*