CIMA Reports Continued Growth In Cayman Finance Industry

by Amanda Banks, Tax-News.com, London

16 January 2008

Details of the Cayman Islands Monetary Authority's (CIMA) operations for the financial year ending 30 June 2007 and indicators of the financial sector's performance were recently released in CIMA's Year in Review, 2006-07 report.

The report recorded the growth in CIMA-regulated financial services during the 2006-07 fiscal year, led by the investments and securities and insurance sectors.

Together, the number of funds, fund administrators and securities investment businesses grew by 16%, from 9,233 at June 2006 to 10,742 at June 2007. Funds made up the largest portion, increasing by 14% from 7,845 to 8,972 entities.

Insurance licences, comprising domestic insurer licences (class A), captive licences (class B - which are held by entities writing non-domestic business only), insurance managers, brokers and agents, increased by a total of 4.6%, from 882 to 923. Captives accounted for 752 licences.

In the banking sector, while the total number of banking and trust licences declined by 4% (12 licensees) to 283, due mainly to continuing consolidations worldwide, the assets and liabilities of licensees continued to increase. Total international assets booked through banks in the Cayman Islands stood at USD1.8 trillion at 30 June 2007, a 28% increase over the June 2006 figure of USD1.4 trillion. Liabilities at 30 June 2007 totalled USD1.8 trillion, up from USD1.3 trillion at 30 June 2006.

The amount of Cayman Islands currency in circulation at the end of the fiscal year was CID76.2 million, an 8% increase over the June 2006 figure of CID70.5 million. This comprised CID67.9 million in notes and CID8.3 million in coins.

The Authority collected a total of CID60.3 million in licensing fees on behalf of the government for the fiscal year, compared to CID55.7 million for 2005-06.

Details of the regulatory measures instituted by the Authority during the period are included, such as the addition to the Guidance Notes on the Prevention and Detection of Money Laundering in the Cayman Islands of sector specific guidance for insurers and investments and securities entities. New CIMA initiatives such as the electronic reporting project are also covered.

The Year in Review additionally noted CIMA's cross-border assistance and involvement on regulatory issues, including the processing of 156 requests for assistance from overseas regulatory authorities and the negotiation of memoranda of understanding for information exchange with the Jersey Financial Services Commission.

The Authority's performance against its 2006-07 strategic goals and work plan was outlined in the report, as well as its operational support and administrative activities.

Though completed and audited, CIMA's financial statements for the period are not yet available to the public. These will be published once they have been accepted by the Cabinet, and have gone before the Legislative Assembly.

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