THE MAURITIUS CIVIL SERVICE MUTUAL AID … · THE MAURITIUS CIVIL SERVICE MUTUAL AID ASSOCIATION LTD ... Synopsis of Mauritius MCS Mutual Aid Association Ltd 2010. ... deposits to

THE MAURITIUS CIVIL SERVICE

MUTUAL AID ASSOCIATION LTD

ROLE OF BANKING & FINANCIAL ACTIVITIES IN THE DEVELOPMENT OF

MAURITIUS.

MCS Mutual Aid Association Ltd 2010

Contents


Synopsis of Mauritius


Historical Background


General Information


General Info.


ROLE OF BANKING AND

FINANCIAL ACTIVITIES IN THE

DEVELOPMENT OF MAURITIUS


The Financial Services Sector(FSS)

-The financial sector in Mauritius is dominated by banks and insurance

companies which account for more than 70% of the sector’s total assets

-Analysis of financial soundness indicators(FSIs) in the Financial year 2009-

2010 ,pointed towards the soundness of the banking system.

-FSS is well positioned to be the engine of growth in the services sector as a

whole

-The continuous development of the banking and financial sector has been

due to well defined strategies implemented over time.

-The two largest domestically –owned banks have already looked beyond

Mauritius by incorporating branches and subsidiaries in the region.


REPUTATION

• Mauritius is viewed as a highly credible financial

sector

• With the expertise built over time , the favourable

legislative and regulatory framework should

continue to contribute to the success of the banking

sector.

• -Banks in Mauritius are well capitalised with capital

adequacy ratios well above the regulatory

minimum of 10% and risks in the banking sector

were well managed and kept within the prudential

limits prescribed by the Bank.MCS Mutual Aid Aseeesociation Ltd 2010

ECONOMIC ENVIRONMENT

-Mauritius is a small open economy and is vulnerable

to external shocks.

-Recently,the global economy was severely affected by

the sub-prime crisis

-However, Mauritius was spared as the country did not

invest in toxic assets.Our economy showed much

resilience.

International institutions including the IMF and other

observers commended the economic performance of

Mauritius and even cited us as an example of

resilience during the crisis.MCS Mutual Aid Association Ltd 2010

REGULATOR IN MAURITIUS

• Bank of Mauritius(BOM) is the central bank

• BOM-regulates all banking activities including

Non Bank Deposit Taking institutions

• Financial Services Commisssion(FSC)-regulate

non banking sector-e.g insurance

companies,offshore companies,trust,etc.


MAJOR BANKS AND INSURANCE

COMPANIES

• BANKS-MCB LTD,SBM LTD,BARCLAYS,HSBC

• INSURANCE COMPANIES-SICOM

LTD,MAURITIUS UNION ASSURANCE

LTD,SWAN LTD,MAURITIUS EAGLE INSURANCE

LTD.


ECONOMIC GROWTH

• The Mauritian economy grew as follows:

2009- 3.1%

• 2010- 4.1%

• Growth in the banking activities was around 6.0% in

2010.

• Real activity in the insurance and other financial

intermediaries sub-sectors slowed down.

• The insurance sector grew by 4%.The financial

intermediation sector added 0.5% point to real GDP

growth in 2009.MCS Mutual Aid Association Ltd 2010

PERFORMANCE OF THE BANKING

SECTOR

-Banking sector remained in good shape

-It showed commendable resilience due to our

prudent regulatory and supervisory framework.

-Growth was lower than last year

-It is considered quite robust against the backdrop

of the global economy

-Most banking and financial sector around the world

were in deplorable state following the economic

crisis.MCS Mutual Aid Association Ltd 2010

CONTRIBUTION

• The banking and financial sectors contributed

a lot in the economic development of the

country

• Mauritius experienced a very low rate of

inflation

• Current tendency is for inflation to increase

• The banking sector emerged practically

unscathed from the global financial and

economic crises.MCS Mutual Aid Association Ltd 2010

GUIDELINES

• The central bank continued in its endeavour

to enhance the guidelines and guidance notes

to incorporate changes in best practices as

advocated by international setting bodies like

the Basel Committee on Banking Supervision

and the IASB.

• The total assets (liabilities) of banks grew by

Rs 27,479 million or 9.1% from year 2009 to

2010.


BANKING SECTOR

• At the end of June 2010,the banking sector in

Mauritius comprised nineteen banks licensed

to carry out banking business.

• The 19 banks operated 208 branches,12

counters,1 mobile van and 386 Automated

Teller Machines(ATMs) and employed 6,641

people at the end of June 2010.

• Besides traditional banking facilities,eleven

banks offer card-based payment services such

as credit and debit cards while twelve banks MCS Mutual Aid Association Ltd 2010

LIQUIDITY

• Provide internet banking and one bank provides

phone banking facilities.

• -Growth of credit to the private sector by banks

slowed down markedly in 2009 and 2010 and this

contributed to the build-up of additional liquidity in

the system.

• The Central bank had to initiate measures with a

view to bringing liquidity to a reasonable level

• Depositors’ confidence in the banking sector was not

affected by the global finacial crisis and continued to

remain strong. MCS Mutual Aid Association Ltd 2010

PRESSURE

• -There were no indicators that domestic and

international banks faced any pressure to raise

deposits to fund their lending activities.

• In the insurance sector, three large companies hold

more than 80% of total assets in that sector.The

insurance industry also posted a reasonable

performance .

• Overall,the financial sector has remained relatively

healthy and continue to support the domestic

economic recovery


FINANCIAL STABILITY

• Risks to financial stability arising from the activities

of banking institutions are considered as

low.Nevertheless,some downside risks to the

revenues of most financial institutions remain due to

stagnating activities.


Banks Licensed by Central bank to

carry Banking Business (1)• 1. ABC Banking Corporation Ltd

• 2. AfrAsia Bank Limited

• 3. Bank One Limited

• 4. Bank of Baroda

• 5. Banque des Mascareignes Ltee

• 6. Barclays Bank PLC

• 7. Bramer Banking Corporation Ltd


Banks Licensed to carry Banking

Business (2)

• 8. Deutsche Bank (Mauritius) Limited

• 9. Habib Bank Limited

• 10. HSBC Bank (Mauritius) Limited

• 11. Investec Bank (Mauritius) Limited

• 12. Mauritius Post and Cooperative Bank Ltd

• 13. P.T Bank International Indonesia

• 14. SBI (Mauritius) Ltd


Banks Licensed to carry Banking

Business (3)

• 15. Standard Bank (Mauritius) Limited

• 16. Standard Chartered Bank (Mauritius) Limited

• 17. State Bank of Mauritius Ltd

• 18. The HongKong and Shanghai Banking

Corporation Limited

• 19. The Mauritius Commercial Bank Ltd.


Non-Bank Deposit Taking

Institutions (1)

• 1. AXYS Leasing Ltd

• 2. Barclays Leasing Company Limited.

• 3. Cim Finance Ltd

• 4. Dolberg Asset Finance Limited

• 5. Finlease Company Limited

• 6. La Prudence Leasing Finance Co. Ltd

• 7. Mauritius Housing Company Ltd


Non-Bank Deposit Taking

Institutions (2)

• 8. Mauritius Eagle Leasing Company Limited

• 9. SICOM Financial Services Ltd

• 10. The Mauritius Civil Service Mutual Aid

Association Ltd

• 11. The Mauritius Leasing Company Limited.


Money-Changers (Bureaux de

Change) (1)

• 1. Abbey Royal Finance Ltd

• 2. Change Express Ltd.

• 3. Easy Change (Mauritius) Co. LTD

• 4. EFK Ltd

• 5. InterCash Ltd

• 6. Iron Eagle Ltd

• 7. Jet Change Co Ltd


Money-Changers (Bureaux de

Change) (2)

• 8. Max & Deep Co. Ltd

• 9. Moneytime Co. Ltd

• 10. Storm Rain Co Ltd

• 11. Unit E Co Ltd

• 12. Viaggi Finance Ltd

• 13. Vish Exchange Ltd

• 14. Gowtam Jootun Lotus Ltd


Foreign Exchange Dealers

• 1. British American Exchange Co. Ltd

• 2. Cim Forex Ltd

• 3. Forex Direct Ltd

• 4. Shibani Finance Co. Ltd

• 5. Thomas Cook (Mauritius) Operations Company

Limited


Main challenges facing the banking

sector

• excess liquidity on the market

• commercial banks are reluctant to lend due to

the financial crisis

• banks are risk averse

• high level of indebtedness at individual and

country level

• tendency for regulator to “over regulate”

• Mauritius-small market


Conclusion

• The banking and financial activities account for a

large part in the GDP of Mauritius

• Many international banks operate in Mauritius with

onshore and offshore activities.

• The country ,despite being small can accommodate

more financial institutions.

• Due to good regulation by the central bank,we are

not exposed to much financial risk.


WAY FORWARD

• Need for diversification of banking products

and services

• Economy need to be more liberal and

diversified.

• Need more players in the market .This will

ensure more competition


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THE MAURITIUS CIVIL SERVICE MUTUAL AID … · THE MAURITIUS CIVIL SERVICE MUTUAL AID ASSOCIATION LTD ... Synopsis of Mauritius MCS Mutual Aid Association Ltd 2010. ... deposits to