BOM Publishes Guidelines for Private Banking and Digital Banks
The Bank of Mauritius (BoM) has been removed from the list of high-risk countries under the UK Money Laundering and Terrorist Financing (Amendment) (No. 3) (high-risk countries) Regulations 2021. BoM also issued the revised guideline on private banking and a new guideline for digital banks. The guideline on private banking sets out the regulatory and supervisory framework applicable to banks conducting private banking business while the guideline on digital banks sets out the regulatory and supervisory framework for operating a digital bank in Mauritius. Both the guidelines come into effect from December 06, 2021.
The guideline for digital banks specifies additional requirements to, or exemptions from the legal, regulatory, and supervisory framework applicable to traditional banks and the terms and conditions under which BoM shall consider these exemptions under section 7(7E) of the Banking Act 2004. Digital banking business is defined in the Banking Act 2004 as "banking business carried on exclusively through digital means or electronically." The guideline shall apply to banks licensed under section 7(5) of the Banking Act 2004 to carry on exclusively digital banking business (digital bank) and private banking business or Islamic banking business solely through digital means or through electronic delivery channels under section 52(1) of the Banking Act 2004 (digital private bank or digital Islamic bank). The guideline stipulates that a restricted digital bank shall comply with banking laws, the Guideline on Fit and Proper Person Criteria, the Guideline on Related Party Transactions, the Guideline on Corporate Governance, the Guideline on Credit Concentration Risk, Guideline on Credit Risk Management, Guidelines on Outsourcing by Financial Institutions, Guideline on Liquidity Risk Management, Guideline on Maintenance of Accounting and Other Records and Internal Control Systems, the Guideline on the Computation of Debt-to-Income Ratio for Residential Property Loans, Guidelines for Calculation and Reporting of Foreign Exchange Exposures of Banks, the minimum capital requirements prescribed in this Guideline, and the prudential limits set out under this section. The guideline also sets out the requirements pertaining to Anti-Money Laundering and Combating the Financing of Terrorism and Proliferation (AML/CFT).
Furthermore, the guideline for digital banks stipulates that a digital bank shall comply with all the statutory reporting requirements and submit the regulatory returns and any other reporting requirements as communicated by BoM. During the restricted phase, a restricted digital bank shall also submit, to BoM, half-yearly progress updates on the implementation of its business plan. A digital bank shall also ensure compliance with the relevant data protection laws and regulations. However, a restricted digital bank shall, upon request, be exempted from the requirement to submit regulatory returns that may not be applicable to its business model.
Related Links
- Media Release on High-Risk List
- Notice on Guidelines
- Guideline on Private Banking
- Guideline for Digital Banks
Effective Date: December 06, 2021
Keywords: Middle East and Africa, Mauritius, Banking, Private Banking, Digital Banking, Regulatory Capital, Reporting, Basel, AML/CFT, BOM
Featured Experts
María Cañamero
Skilled market researcher; growth strategist; successful go-to-market campaign developer
Nicolas Degruson
Works with financial institutions, regulatory experts, business analysts, product managers, and software engineers to drive regulatory solutions across the globe.
Patrycja Oleksza
Applies proficiency and knowledge to regulatory capital and reporting analysis and coordinates business and product strategies in the banking technology area
Previous Article
EBA Publishes Final Regulatory Standards on STS SecuritizationsRelated Articles
ESAs Issue Multiple Regulatory Updates for Financial Sector Entities
The three European Supervisory Authorities (ESAs) issued a letter to inform about delay in the Sustainable Finance Disclosure Regulation (SFDR) mandate, along with a Call for Evidence on greenwashing practices.
FSB and NGFS Publish Initial Findings from Climate Scenario Analyses
The Financial Stability Board (FSB) and the Network for Greening the Financial System (NGFS) published a joint report that outlines the initial findings from climate scenario analyses undertaken by financial authorities to assess climate-related financial risks.
FSB Issues Reports on NBFI and Liquidity in Government Bonds
The Financial Stability Board (FSB) published a letter intended for the G20 leaders, highlighting the work that it will undertake under the Indian G20 Presidency in 2023 to strengthen resilience of the financial system.
ISSB Makes Announcements at COP27; IASB to Propose IFRS 9 Amendments
The International Sustainability Standards Board (ISSB) of the IFRS Foundations made several announcements at COP27 and with respect to its work on the sustainability standards.
IOSCO Prioritizes Green Disclosures, Greenwashing, and Carbon Markets
The International Organization for Securities Commissions (IOSCO), at COP27, outlined the regulatory priorities for sustainability disclosures, mitigation of greenwashing, and promotion of integrity in carbon markets.
EBA Finalizes Methodology for Stress Tests, Issues Other Updates
The European Banking Authority (EBA) issued a statement in the context of COP27, clarified the operationalization of intermediate EU parent undertakings (IPUs) of third-country groups
EU Finalizes Rules Under Crowdfunding Service Providers Regulation
The European Union has finalized and published, in the Official Journal of the European Union, a set of 13 Delegated and Implementing Regulations applicable to the European crowdfunding service providers.
OSFI Sets Out Work Priorities and Reporting Updates for Banks
The Office of the Superintendent of Financial Institutions (OSFI) published an annual report on its activities, a report on forward-looking work.
APRA Finalizes Changes to Capital Framework, Issues Other Updates
The Australian Prudential Regulation Authority (APRA) finalized amendments to the capital framework, announced a review of the prudential framework for groups.
BIS Hub and Central Banks Conduct CBDC and DeFI Pilots
The Bank for International Settlements (BIS) Innovation Hubs and several central banks are working together on various central bank digital currency (CBDC) pilots.
