Barbados Foreign Currency Earning Banks

• the acceptance of foreign money deposits payable upon demand or after a fixed period or after notice
• the sale or placement of foreign bonds, foreign certificates, foreign notes or other foreign debt obligations or other foreign securities
• any other similar activity involving foreign money or foreign securities.

• loans, advances and investments
• the activities of the FCEB for its account of or at its risk
• the purchase or placement of foreign bonds, foreign certificates, notes or other foreign debt obligations or other foreign securities
• any other similar activity involving foreign money or foreign securities.

• amounts of money in foreign currencies or securities or both
• foreign personal or foreign movable property
• foreign real or foreign immovable property.

The main benefits of operating a foreign currency earning bank in Barbados are:

• tax rates ranging from 5.5 to 1.0% based on levels of income
• no withholding tax on dividends, interest and other payments made to non-residents of Barbados
• exemption from exchange control restrictions (entity must earn 100 percent of their income in foreign currency, from January 1, 2019).

If you are considering forming a foreign currency earning bank in Barbados, you first need to submit a preliminary application to the Central Bank of Barbados for approval. The application for a licence must include a brief description of the nature of the financial service to be provided from Barbados, financial projections, the names and addresses of the directors, names and addresses of the shareholders and the number of shares to be held, together with other due diligence information.  

After the submission is appraised, and if it’s successful, you’ll be granted consent from the Minister of Finance for the incorporation or registration of the company in Barbados. You then need to submit a final application to the Director of Bank Supervision who, subject to the approval of the Minister of Finance, will issue a licence to the company to carry out financial services.

The company must also have a minimum assigned capital of US$2,000,000 if the bank is authorised to accept third party deposits, or a minimum assigned capital of US$500,000 if the bank does not accept third party deposits. The Minister may at his discretion alter the above sums.

• Annual audit
• Annual returns to be filed by the end of the 4th month after the financial year end
• Annual filing of audited financial statements
• Submission of monthly and quarterly statements of a licensee’s assets and liabilities to the Central Bank of Barbados
• Annual tax returns to be filed with the Barbados Revenue Authority.