Global regulators are taking a more aggressive approach in the name of transparency and this will have wide reaching implications for international financial centres around the world, warned representatives from the Society of Trust and Estate Practitioners (STEP) Worldwide this week.

Speaking at the Nassau Conference held at the British Colonial Hilton last week, STEP Worldwide deputy chief executive George Hodgson said: “Transparency is the new normal. We need to get real and accept that.”

Hodgson went on to predict that by 2020 there will be automatic tax information exchange between major economies and a risk averse banking system that will be “very wary”.

He also suggested that a culture of transparency may curtail international diversification.

“We are still exploring the implications of this move towards transparency. It is going to be much tougher to do business,” he said. “The financial centres that depend on these flows need to start thinking quite hard about this.”

Chair of STEP Worldwide Helene Anne Lewis agreed and said it would be more difficult for Caribbean IFCs to comply with an increased regulatory burden.

“The game is at half time and we are playing catch-up,” she said. “We must put our heads together to decide how to meet the new reality while staying in business.”

She commented that STEP could play its part by focusing on education as a means of “empowering members” and ensuring they are better equipped to meet any future challenges. She said the organization would increase and improve its educational programmes with this in mind.

Joining the discussion, Minister of Financial Services Ryan Pinder said The Bahamas’ strategy was to focus on its product portfolio to attract clients and that it was key to “stay ahead of the game and plan and offer products.”

cmorris@dupuch.com