NASSAU, BAHAMAS — Central Bank Governor John Rolle said yesterday that the regulator believes that additional refinements are now needed to sustain more retail investor access to overseas investment funding, noting that the demand for investment currency in particular has accelerated.
Governor Rolle while speaking at a press briefing on the regulator’s Monthly Economic and Financial Developments report for June noted that the Central Bank is reviewing the administrative policies in place for the Investment Currency Market and the access permitted to overseas investment funding through the Bahamas Depository Receipt or BDR framework.
“On sum, the demand for investment currency, in particular, has accelerated, and the Bank is of the view that additional refinements are now needed to sustain more retail investor access, while moderating potential wholesale outflows, within a more defined multi-year framework,” Rolle said.
“In addition, the Central Bank is continuing to explore how BDR activity, which already has a more concentrated retail appeal, could be increased. The Bank expects to consult with the Government on such reforms and other administrative adjustments to the Exchange Control policies before the end of the third quarter 2023.”
Commenting on the matter further, Governor Rolle said: “We are seeing a steady increase in interest and I think that is partly based on the lower premium on investment currency purchases which is now just five percent. In 2022 for the annual numbers it was about a quarter of a billion in investment currency-related transactions. We expect this year for the numbers to look the same.”
He added: “We expect this year’s investment currency volumes to be a or where they were in 2022. We are already ahead of the 2022 half-year estimates so there is no reason to believe that the end-of-year results will be any different.”
Back in December, the Central Bank revealed that it had approved just over $200 million in transactions after it had introduced a temporary waiver of the five percent investment currency market (ICM) premium for purchases of Bahamas Government US Dollars bonds.
