DFSA Signs MoU With Major US Regulator

by Lorys Charalambous, Tax-News.com, Cyprus

16 June 2010

The Dubai Financial Services Authority, the regulator for the Dubai International Financial Centre, said that it last week entered into a Memorandum of Understanding (MoU) with the New York State Banking Department, which will significantly enhance bilateral cooperation between the two regulators, particularly in information exchange.

The US Department is the primary regulator for state-licensed and state-chartered financial entities, including domestic banks, foreign agencies, branches and representative offices, savings institutions and trust companies, credit unions and other financial institutions operating in New York including mortgage bankers and brokers, check cashers, money transmitters, and licensed lenders, among others. Total assets of the institutions regulated by the Department amount to nearly USD2.4 trillion.

One branch of a bank regulated by the Department carries out financial services in and from the Dubai International Financial Centre, supervised by the DFSA.

The MoU was signed by Paul Koster, Chief Executive of the DFSA, and Richard Neiman, New York State’s Superintendent of Banks, at the Department’s headquarters in New York.

Commenting on the signing of the memorandum, Koster said: “I am very pleased to have concluded this arrangement with Superintendent Nieman and the DFSA is honoured to have formalised its relationship with the oldest banking regulatory agency in the United States. As co-supervisors of a common institution operating in New York and in the DIFC, the State Banking Department and the DFSA are committed to enhancing co-operation and information sharing in relation to this bank, and any others that may follow in future.

“This memorandum was drafted in light of the Basel Principles for Effective Banking Supervision and complements another MoU established by the DFSA in October 2007 with the four US Federal banking supervisors - the Federal Reserve, the Office of the Comptroller of the Currency (OCC), the Federal Deposit Insurance Corporation (FDIC), and the Office of Thrift Supervision (OTC), to ensure a co-ordinated approach between home and host supervisors of a number of significant US banks.”

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