Financial institutions

Russians have over US$2 billion in Bahamian financial institutions

The Central Bank of the Bahamas (CBB) says international banks and trust companies operating here hold more than $2 billion in ‘assets on deposit or in trust’ with ultimate beneficial owners from or related to Russia .

In a statement, the CBB said that earlier this month, the Bahamian Financial Services Regulators Group issued a directive to Bahamian financial institutions against doing business with sanctioned persons and entities from Russia and Belarus.

The move follows Moscow’s decision to launch an invasion of Ukraine with the European Union, the United Kingdom and the United States spearheading sanctions against Russia.

In the statement, the CBB is saddened by the call from the local regulator, it has received several inquiries from the press about the amount of Russian business in banks and trust companies in the jurisdiction.

“As an extension of its regular monitoring, the Central Bank has collected data from international banks and trust companies on their level of Russian business activity. The results of this exercise indicated that as of February 28, 2022, this segment held approximately US$420 million in deposits and US$2.5 billion in assets on deposit or in trust with ultimate beneficial owners of or related to the Russia,” the CBB said.

He noted that the largest proportion of Russian exposure would be related to the international sector. “However, the Central Bank is currently surveying domestic financial institutions – meaning commercial banks, money transfer businesses and e-money service providers – to determine any level of exposure in these sectors. “

The CBB said the information it disclosed “is aggregate for the international banking and fiduciary industry, and is not specific to any sanctioned interest.”

Earlier this month, the government warned local businesses to be very careful when doing business with a Russian entity, even though the main opposition party, the Free National Movement (FNM), called on the government to act more decisively in the interest of sovereignty.

A statement from the Cabinet Office says the issue of sanctions has been discussed and that “we are in consultation with all our partners and stakeholders, both domestic and international. This remains an evolving question.

In the meantime, we advise all Bahamian entities to exercise appropriate caution regarding any dealings in our country with Russian individuals and entities that have been sanctioned by the US, EU, Canada and the United Kingdom,” the statement said, adding “we continue to deplore the attack on Ukraine by the Russian Federation.”

The US Embassy in Nassau has urged the Bahamas to limit Russia’s access to the Bahamas’ financial system and to restrict that country’s airspace to Russian aircraft.