Guernsey Financial Services Commission Releases Last Year's Banking Activity Details

Amanda Banks, Tax-news.com, London

29 March 2001

The Guernsey Financial Services Commission has released details of its fourth quarter (2000) banking sector activity, in which period two banks surrendered their licences as a result of the global trend of consolidation which continued through the year and into 2001.

The Commission says that the HSBC group decided that there was no longer any need for its Guernsey branch of the Republic National Bank of New York (Cayman) following a global exercise to reduce the number of its banking entities. And the Guernsey arm of the Birmingham Midshires building society was transferred to a Halifax Plc operation in another offshore jurisdiction - a decision made by Halifax after its recent acquisition of Birmingham Midshires.

The Commission said that total deposits held in Guernsey banks at the end of last year increased by £2,796m from the end of September level of £65,678m to reach a new high of £68,474m. 'We are aware that there were further significant volume increases in the quarter particularly from Swiss fiduciary deposit business. Total assets increased to £72,563m,' stated the Commission.

Philip Marr, Director of Banking, noted: 'Despite the challenges and uncertainties, bank deposits have continued to grow to higher levels mainly driven by international depositors placing foreign currency funds with the bigger banks. The upward pressure on costs needs to be contained if we are to remain competitive but it is encouraging that systems expenditure continues to grow. It is to be hoped that much of this represents investment in automated and labour saving processes.'

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