Cook islands banking

The Cook Islands is a self-governing island country in the South Pacific Ocean in free association with New Zealand. New Zealand is responsible for the Cook Islands’ defense and foreign affairs. Recently the Cook Islands have adopted an increasingly independent foreign policy. The four leading industries in the Cook Islands are tourism, fishing, agriculture and financial services. The banking and incorporation laws of the Cook Islands make it an important center for setting up companies that are involved in global trade. The Cook Islands’ offshore finance business was created by a series of legislative enactments in the 1980s which established a regime for international companies, partnerships and trusts, offshore banking, insurance companies and registered trustee companies.

There are four banks in total licensed to operate in the Cook Islands; four domestic banks are:

• ANZ Banking Group Limited
• Bank of the Cook Islands Limited
• Capital Security Bank Cook Islands Limited
• Bank of South Pacific Limited

Out of the four banks the following three banks also have international bank licenses:

• ANZ Banking Group Limited
• Capital Security Bank Limited
• Bank of South Pacific Limited

The last banking licensed issue was for international banking to Bank of South Pacific Limited and was issued on 20 December 2011. Westpac’s domestic license was issued on 1 July 2004. Under section 9(2) of our Banking Act 2011, it is a requirement that an international banking license can only be issued to a bank that also holds a domestic license. The Banking Act 2011 can be found here, Under section 29 of the Act all banks must have a physical presence in the Cook Islands. New banking licenses can be issued. Application for a banking license must be made to the Financial Supervisory Commission (FSC) as per section 6 of the Banking Act 2011. Part 2 of the Act refers to the licensing process. Banks in the Cook Islands must also comply with the provisions of the Financial Transaction Reporting Act 2004 and section 17 of the Financial Supervisory Commission Act 2003. Besides needing a license from the FSC to operate as a bank in the Cook Islands, any foreign-owned enterprise also needs the approval of the Business Trade Investment Board (BTIB).

Westpac sold banking operations in the Cook Islands, Samoa and Tonga to the Bank of South Pacific Limited in 2015.