Total land area:....................430 sq. km.
Official language:................. English
Administrative divisions:...... 11 parishes (Note: The new city of Bridgetown may be
given parish status).
Legal system:...................... English Common Law; no judicial review of legislative acts.
Executive branch:............... Chief of state‹Queen Elizabeth II (since February 1952),
represented by Governor General Dame Nita Barrow since
June 6, Head Government - Prime Minister Owen Seymour
Arthur (since September 6, 1994), Deputy Prime Minister
(since September 6, 1994) Cabinet appointed by the
Governor General on advise of the Prime Minister.
Legislative branch:............... Bicameral Parliament‹Senate (consists of a 21-member
body appointed by the governor general) and House
of Assembly.
Judicial branch:................... Supreme Court of Judicature
ECONOMIC PROFILE
Currency: Barbados dollar (BDS$)
GDP: US$1.8 billion (1997)
Real GDP growth: 4 (1997p)
GDP (average annual growth rate): 1.3 (1988-1997)
GDP per capita (1990 US$): 7,118.6 (1997)
Consumer price index (average annual growth rate): 7.9% (1997)
Central government fiscal balance (Central Bank of Barbados (CBB)
Basis as a % of current GDP): -1.8 (1997)
Money supply (M1) (% of current GDP): 25.6 (1997)
Interest rate (average prime lending rate): 9.5 (1997p)
Current account balance: US$58.4 million (1997)
Trade balance: -US$600.6 million (1997)
Main commodity exports: Sugar and molasses, rum, other foods and beverages,
chemicals, electrical
components, clothing.
Main commodity imports: Consumer goods, machinery, foodstuffs, construction
materials,
chemicals, fuel and electrical components
Nominal exchange rate (BDS$/US$): 2.0 (January 1998)
Real effective exchange rate (Index 1980=100): 89.0 (1997p)
BANKING INSTITUTIONS
Total number of banks in the system: 7 commercial banks.
Types of banks: 4 local, 3 foreign banks.
Total amount of assets: BDS$3.9 billion (March 1998)
Total amount of deposits: BDS$3.2 billion (March 1998)
Total amount of capital or net worth: BDS$197,935 million (March 1998)
BANKING INSTITUTIONS
I. Banking Supervision
1. The Bank Supervision
Department of the Central Bank of Barbados is responsible
for bank supervision.
2. It is not an independent
agency.
3. It reports to the Central
Bank and ultimately the minister of finance.
4. Off-site examination
takes place quarterly. The frequency of on-site examinations
depends on the banking institution¹s risk.
5. There is no grading system
used for rating a bank¹s safety and soundness.
6. During on-site inspections,
Barbados uses the CAMEL and CAMEO systems.
II. Consolidated Supervision
1. Barbados does not perform
consolidated supervision.
2. For a Barbados bank to
open or close a branch in a foreign country, notice must
be given to the minister of finance within 30 days of the opening or closing
(Section 13 FIA #2 & #4).
3. Barbados does not require
prior consent from the home country to open or close
a foreign branch in Barbados; however, Barbados will notify the foreign
country
of any change of status of the foreign bank.
4. Barbados may request
information from appropriate authorities on parent holding
companies or any other company owning majority shares in a Barbados licensee
(FIA #52(1)).
III. Interest Rates
1. Interest rates on loans
are determined by the market.
2. The government sets minimum
deposit interest rates on all interest-bearing deposits.
IV. Deposit Insurance
1. There is no general deposit
insurance program. The country has only one insured
bank, Barbados National Bank, which has a 100% guarantee on deposits from
the government.
2. Insurance limits are
not applicable.
V. Trade Finance
1. Barbados law does not
define trade finance. The Central Bank administers an
export finance guarantee fund.
2. The Central Bank bears
75% of the risk for loans when it approves financing
for a particular purpose. In special circumstances, the risk borne by the
Central
Bank may extend to 90%. The risk of import finance, pre-export finance
and
other trade finance vehicles is borne by the bank.
3. In cases of bank liquidation,
bank regulators treat trade finance vehicles the
same way as domestic operations.
4. The banking system does
not make special provisions or require reserves for
treatment of trade finance obligations during bank liquidations.
VI. Capital Adequacy
1. The minimum capital required
to open and operate a bank is four million Barbados
dollars.
2. The minimum capital required
to operate a bank is four million Barbados dollars.
Categories
Percentages
Tier I & II
8%
Tier I minimum
4%
VII. Asset Quality
1. The loan portfolio is
classified as follows:
Loan Classification
% of Reserves
Pass
0%
Special Mention
0%
Substandard
0% if fully secured, 10% if not fully secured
Doubtful
50%
Loss
100%
2. Banks are required to
maintain a reserve fund. They are required to transfer not
less than 25% of profits to the fund whenever the fund is below the
level of issued
and paid capital.
3. The legal lending limit
to one person or group is 25% of the sum of the stated capital
and published reserves of the bank. When a portion of the loan is unsecured
the limit
is 10% of the sum of the stated capital or reserves of the bank. When the
total loan
is unsecured, the limit is $40,000 or 1% of the sum of the stated capital
of the bank,
whichever is greater. This sum also applies to financial guarantees to
bank insiders.
A bank cannot grant credit to bank insiders on terms and conditions more
favorable
than generally applicable to other customers.
4. Investment portfolios
need not be categorized according to criteria such as
hold-to-maturity portfolio, available-for-sale portfolio or trade portfolio.
5. Investment categories
are not applicable.
6. The valuation of the
investment portfolio requirement does not affect the
profit and loss statement.
VIII. Liabilities
1. The reserve requirement
is applied to all domestic deposits using the average
of the previous three weeks¹ deposits as a base. It is applied as
follows: 5%
to be held in cash, 8% in treasury bills and 12% in government debentures.
2. Bank deposits can be
offered in both domestic and foreign currency.
3. There is no limit on
the concentration of specific types of deposits.