I<$c$>t is not surprising that a widespread misperception among island residents is that the Bermuda Monetary Authority’s main function revolves around issuing the Island’s money.

At its inception in 1969 the Authority’s primary role was issuing Bermuda’s currency and other foreign exchange control. However, as the Island’s financial services markets have grown, its responsibilities have evolved and broadened significantly.

Today, in addition to issuing currency and foreign exchange control, the Authority is also the unitary regulator of all sectors within Bermuda’s financial services market.

Marcia Woolridge-Allwood, director of Corporate and Financial Services at the Authority explains further: “As the single regulator of the Island’s financial services sector, we supervise the activities of the banks, investment businesses, trust companies, insurance companies, the Credit Union and the Bermuda Stock Exchange.

“In addition we are the central monetary authority, which in other countries might be called the Central Bank, and we still are responsible for the issuing of the country’s notes and coins.

“As the Island’s financial services regulator we make sure that the businesses are run in accordance with international standards and that Bermuda maintains its reputation as a first class international financial centre that is well regulated, and that fosters increasing business coming into the country.” To conduct its supervisory duties the Authority has two regulatory units: the Insurance Department, which is responsible for the supervision of Bermuda’s dynamic insurance industry, consisting of both domestic insurance companies and international (re)insurance companies; and the Banking, Trust and Investment Department, which supervises the island’s banks, trust companies and investment business.

The Authority is also responsible for the licensing and authorisation of all companies looking to conduct business from or within Bermuda, acting as the agent of the Ministry of Finance in that capacity.

The Authority also participates with a number of international standard setting bodies via involvement with committees and working groups, such as the International Association of Insurance Supervisors (IAIS) for the Insurance industry and the Basel Committee for banking, as a way to keep abreast of changes in international regulatory standards, and also to promote the uniqueness of the Bermuda market. Some senior members of Authority staff are even members of certain international committees set up to develop global standards in financial services regulation. With regard to banking supervision, Mrs. Woolridge-Allwood explains: “Unlike many of our competing jurisdictions, Bermuda was at one stage the only country that conducted consolidated supervision on a world-wide basis.

“The reason for this was because prior to HSBC acquiring Bank of Bermuda, we were the consolidated supervisor for that bank’s operations in 19 countries, and we still are for Butterfield Bank, which is headquartered in Bermuda.”

So why is financial services regulation so important? It helps to promote financial stability, which is imperative to any country, and in today’s global marketplace it is even more critical to maintain. An important objective for the Authority is to protect investors and policy-holders.

“The Authority has certain powers under the Bermuda Monetary Authority Act 1969 and other related legislation to ensure that business is conducted in a prudent manner that minimises risk to stakeholders,” said Mrs. Woolridge-Allwood.

“Bermuda’s financial services customers can be assured that the responsibilities undertaken by the Authority are ultimately protecting their interests.”<@$p>BMA CEO Cheryl-Ann Lister said: “We wish to express our sincere appreciation to our staff for their cooperation not only during this latest move, but also during the Authority’s on going transition period as our regulatory responsibilities have grown so rapidly.”