What requirements must be met to establish a new bank?
Banking
Asked by Question Bot04/May/20131 answer
1 Answer
F
Faisal Khan
Answered 04/May/2013
It varies from country to country, but the process remains the same. You go to your central bank and apply for a banking license. It is usually a process between 12-18 months, before you are granted a provisional license.
Some of the points the bank will consider in your application:
In each bank there is a Banking Supervisory Department that would be looking at all of this and be examining everything with great scrutiny before a provisional license is granted.
In almost all cases the 1st review of your provisional license would be 90-180 days, and such evaluations would continue every quarter for typically 2-3 years before a full-fledge license is granted.
Some of the points the bank will consider in your application:
- Paid Up Capital
- Management and Ownership
- Board of Directors
- Articles of Incorporation and memorandum of association
- Experience in the field (that of your proposed team)
- Rollout plan
- Feasibility study
- Risk, Insurance and Liability study
- Deposit investment plans
- Core Banking System
- Technology Incorporation
- Memberships and Associations with Financial Services Companies and/or Networks
- Markets and Customers you would be servicing
- Operational Control & Processes
In each bank there is a Banking Supervisory Department that would be looking at all of this and be examining everything with great scrutiny before a provisional license is granted.
In almost all cases the 1st review of your provisional license would be 90-180 days, and such evaluations would continue every quarter for typically 2-3 years before a full-fledge license is granted.