Banks
Banking business is defined in Section 1(1) of the Banking Act 1998, as amended, ("the Act") as the carrying on of any of the following activities:
Those carrying on activities defined as banking business require a licence from the Commission.
Where it appears to the Commission that the business being carried on is similar in character to a banking business the Commission has the power under Section 1(3) of the Act to deem the activity to be banking business, and therefore licensable.
To accommodate those whose business may technically fall within the definition of banking business, as defined in Section 1(1) of the Act, but in the Commission's opinion is not banking business, the Commission also has the power under Section 1(3) of the Act to deem an activity not to be banking business.
The Banking Licence
An unrestricted banking licence permits a bank to conduct a full range of banking business with customers both in the Isle of Man and elsewhere. The licenceholder must have a real presence on the Isle of Man. This means that it must satisfy the Commission that it has, on the Isle of Man, management and staff, discrete and secure premises, and adequate systems and resources to conduct banking business.
All banking licenceholders must be members of the Depositors' Compensation Scheme ("the Scheme") except that, if they are not accepting retail deposits, they may apply for exemption from the Scheme.
Managed Banks
A Managed Bank employs the services of another licensed bank in the Isle of Man, the "Approved Manager", to provide the day to day management and administrative functions to it. The Managed Bank may not employ any staff in the Island without the consent of the Commission; and it must operate from the premises of the "Approved Manager".
The Commission’s licensing policy for Banks
The Commission’s General Licensing Policy provides guidance for banking licenceholders. A licenceholder and its key staff are required to be fit and proper persons. The Commission’s licensing policy is to apply a test of fitness and properness in the key areas of integrity, competence and solvency.
Banking licenceholders are required to comply with the regulatory codes as detailed in the Banks Online Handbook.
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