Global Banking icon Barbados is a well-established, global financial services jurisdiction. There are several benefits to establishing a bank in Barbados.

All Financial Institutions, including Foreign Currency Earnings Banks (FCEB) are governed by the Financial Institutions (Amendment) Act, 2018-51. FCEBs are authorised under the Act (324A 111B) to:

Receive foreign funds through:

  • 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

Use the foreign funds so acquired, either in whole or in part, for:

  • 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

The business of accepting in trust

  • Amounts of money in foreign currencies or securities or both
  • Foreign personal or foreign movable property
  • Foreign real or foreign immovable property

Why Locate an FCEB in Barbados

The main benefits of operating an FCEB in Barbados include:

1. Tax rates ranging from 5.5% to 1.0% based on levels of income
2. No withholding tax on dividends, interest and other payments made to non-residents of Barbados
3. Exemption from exchange control restrictions (Entity must earn 100% of their income in foreign currency, from January 1, 2019)

Total number of FCEBs

As at December 9, 2019 the total number of licensed FCEBs was 22. (Central Bank of Barbados)

Foreign Currency Earning Banks – Formation and Other Requirements

What are the formation requirements?

A prospective applicant must 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, consent is obtained from the Minister of Finance for the incorporation or registration of the company in Barbados. A final application must be made to the Director of Bank Supervision who, subject to the approval of the Minister of Finance, may issue a license to the company to carry on 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.

Other requirements?

  • Annual audit required
  • 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
  • Annual tax returns must be filed with the Barbados Revenue Authority