Central Bank of Belize (CBB)

Overview

The Central Bank of Belize (CBB) is the central bank of Belize and serves as the primary monetary and financial authority. Established in 1982 and headquartered in Belmopan, the CBB operates under a board-based governance structure with responsibility for monetary policy, banking system supervision, and payment system management.

Current Leadership:

• Governor: Kareem Michael (serving since December 1, 2021)

• Chief Executive Officer: Governor Michael, who provides strategic direction and leadership

• Deputy Governors:

• Mr. Hollis Parham (appointed December 1, 2021)

• Mrs. Murillo (appointed September 1, 2022)

• Governance: Board of Directors with oversight of CBB strategic direction

The CBB's leadership structure reflects a professional central banking institution with experienced governance and operational leadership.

Basic Identity

Classification

Inclusion Justification

What This Entity Oversees

The CBB exercises comprehensive supervisory authority over banking institutions, non-bank financial entities, and other regulated financial service providers.

Supervisory Functions:

• Licensing and authorization of banking institutions and financial service providers

• Capital adequacy and prudential requirements

• Asset quality evaluation and loan classification

• Liquidity management standards

• Operational risk and governance oversight

• AML/CFT compliance monitoring

• Consumer protection and complaint handling

• Financial stability assessment

• Credit score system development

Regulatory Standards:

• Basel III capital adequacy standards adapted for Belizean conditions

• Loan loss provisioning based on asset quality classification

• Liquidity coverage ratios (LCR) and net stable funding ratios (NSFR)

• Single borrower exposure limits and concentration controls

• Related-party transaction restrictions

• Market conduct and consumer protection rules

Credit Transparency Initiative:

The CBB is moving closer to establishing a credit score system for enhanced financial transparency. This initiative aims to:

• Improve credit information availability for lenders

• Support better credit risk assessment

• Enhance financial system transparency

• Facilitate credit access for qualified borrowers

• Support financial inclusion objectives

Supervisory Tools:

• On-site examinations (routine and targeted)

• Off-site monitoring and regulatory data collection

• Enforcement actions for violations

• Mandatory corrective action programs (MCPs)

• Management removal and board intervention authority

• License suspension and revocation powers

Banking Sector Status:

Belize's banking sector comprises approximately 6–8 commercial banks with total assets exceeding $2 billion BZD (approximately $1 billion USD). The sector has maintained reasonable capital adequacy despite economic challenges from tourism disruption and commodity price volatility.

The CBB operates within Belize's comprehensive AML/CFT legal framework, addressing money laundering, terrorist financing, and sanctions compliance.

Legal Foundation:

• Money Laundering and Terrorist Financing Prevention Act

• Banking Act provisions on financial crimes

• Financial Services Commission oversight (securities sector)

• Proceeds of Crime Act

Regulatory Requirements:

• Know Your Customer (KYC) and Customer Due Diligence (CDD)

• Enhanced Due Diligence (EDD) for high-risk clients and jurisdictions

• Suspicious Activity Reporting (SAR)

• Currency Transaction Reporting (CTR) for transactions above thresholds

• Beneficial ownership identification

• Record-keeping and documentation requirements

Sanctions Compliance:

The CBB ensures financial institutions comply with:

• UN Security Council sanctions

• OFAC sanctions designations

• Targeted Financial Sanctions (TFS)

• Implementation through customer screening systems

AML/CFT Supervision:

• AML/CFT compliance integrated into banking supervision

• Dedicated AML/CFT examination program

• Compliance testing and effectiveness assessment

• Training and awareness for financial institutions

• Coordination with Financial Intelligence Unit (FIU)

Belize-Specific Concerns:

• Drug trafficking-related money laundering

• Informal financial system monitoring

• Correspondent banking relationship protection

• De-risking prevention efforts

• Cash-intensive business sector oversight

Regulatory Powers

The CBB maintains enforcement mechanisms for violations of banking law, monetary regulations, and financial crimes statutes.

Administrative Enforcement Powers:

• Monetary fines for regulatory violations

• License suspension and revocation

• Management removal and board intervention

• Mandatory capital injections

• Activity restrictions and prohibitions

• Public enforcement action disclosure

Enforcement Approach:

1. Warning letters and guidance

2. Corrective action programs with timelines

3. Monetary penalties for violations

4. Activity restrictions

5. License suspension or revocation

Criminal Coordination:

The CBB coordinates with prosecutorial and law enforcement authorities for criminal investigations involving:

• Large-scale fraud and embezzlement

• Money laundering operations

• Drug trafficking-related financial crimes

• Unlicensed financial services

• Cross-border financial crimes

Regulatory Role and Function

Legal Foundation

The CBB operates under the Central Bank of Belize Act and the Belize Constitution. The central bank's statutory mandate includes:

• Formulating and implementing monetary policy

• Maintaining price stability and financial system stability

• Managing foreign exchange reserves

• Supervising and regulating banking institutions and financial service providers

• Managing the Belize dollar (BZD) as the national currency

• Acting as banker to the state and financial institutions

• Payment system operation and oversight

• Supporting economic development objectives

Institutional Framework:

The CBB Act grants the central bank autonomy in monetary policy matters, protecting institutional independence while maintaining accountability through Board oversight and public reporting.

Licensing and Authorization Relevance

The Central Bank of Belize (CBB) is a key licensing authority in Belize's financial system:

The licensing process typically involves assessment of capital adequacy, fitness and propriety of management, business plan viability, AML/CFT compliance frameworks, and IT systems readiness.

Payments and Money Movement Relevance

The CBB implements monetary policy through multiple transmission mechanisms designed to achieve price stability while supporting sustainable economic growth. Belize's monetary policy operates within a fixed exchange rate regime pegged to the US dollar.

Policy Framework:

• Fixed Exchange Rate: The BZD is fixed at 2.00 BZD = 1 USD (established 1976)

• Inflation Targeting: The CBB maintains price stability as primary objective given fixed exchange rate

• Policy Interest Rate: The main reference rate guides interbank lending rates

• Open Market Operations (OMOs): Primary tool for liquidity management

• Reserve Requirements: Adjustable minimum reserve ratios for commercial banks

Monetary Policy Instruments:

1. Open market operations (purchases/sales of government securities)

2. Discount window lending facilities

3. Reserve requirement adjustments

4. Interest rate corridor setting

5. Prudential regulations affecting credit expansion

Currency Arrangements:

• The Belize dollar (BZD) operates under a fixed peg to the USD

• Fixed rate of 2.00 BZD = 1 USD since 1976

• Limited central bank flexibility in monetary policy due to fixed exchange rate

• Alternative policy tools focus on credit conditions and reserve management

Recent Monetary Developments (2026):

The CBB's monetary policy emphasizes:

• Maintaining price stability within the fixed exchange rate framework

• Managing inflation from imported goods and energy

• Supporting credit growth to productive sectors

• Preserving adequate foreign exchange reserves

• Coordinating with fiscal authorities on macroeconomic policy

The CBB operates and regulates Belize's payment and settlement infrastructure, ensuring safe and reliable payment system operations.

Core Payment Systems:

• Real-Time Gross Settlement (RTGS): High-value interbank payment settlement in BZD

• Automated Clearing House (ACH): Batch processing for retail transactions

• Check Clearing System: National check processing and clearing

• Card Payment Networks: Oversight of credit and debit card systems

• Wire Transfer Services: Domestic and international wire transfer capability

Digital Payment Development:

• Mobile banking expansion among urban and rural populations

• E-commerce payment infrastructure growth

• Digital wallet services for unbanked populations

• Fintech payment provider oversight

• Contactless and point-of-sale digital payment adoption

Payment System Modernization:

The CBB has invested in modernizing payment infrastructure including:

• System redundancy and backup capabilities

• Cybersecurity frameworks and controls

• Business continuity and disaster recovery planning

• Cross-border payment system interoperability

The CBB manages Belize's foreign exchange policy and maintains official foreign exchange reserves within the constraint of a fixed exchange rate regime.

Exchange Rate Regime:

• Fixed Peg: The BZD is fixed at 2.00 BZD = 1 USD

• Central Bank Role: The CBB maintains the peg through foreign exchange reserve management

• Intervention: Regular management of FX reserves to support the peg

• Limited Flexibility: The fixed rate constrains monetary policy independence

Foreign Exchange Reserves:

Belize maintains foreign exchange reserves estimated at approximately $200–300 million USD as of 2026. Reserve management objectives include:

• Supporting the fixed exchange rate peg

• Providing balance of payments financing

• Ensuring debt servicing capability

• Meeting international reserve adequacy standards for fixed-peg countries

Reserve Composition:

• USD cash and deposit holdings

• US Treasury securities

• Other international liquid assets

• Minimal gold reserves

Capital Account Framework:

Belize maintains a relatively open capital account with some prudential restrictions:

• Resident ability to purchase and hold foreign currency

• Cross-border investment by residents

• Repatriation of investment returns

• Central bank approval for some large transactions

• Monitoring of capital flows given fixed exchange rate

Payment Systems Governed or Overseen

The CBB operates and/or oversees the national payment and settlement infrastructure of Belize. Specific systems include:

[Further detail on specific system names requires verification from official sources]

Relationship to Other Regulators

The CBB participates in international central banking forums and regional cooperation frameworks.

Memberships and Participation:

• Caribbean Regional Technical Assistance Centre (CARTAC)

• Caribbean central bank associations

• Central American Bank for Economic Integration (CABEI)

• Bank for International Settlements (BIS) relationships

• Financial Action Task Force (FATF) mutual evaluation process

• CARICOM monetary integration initiatives

Regional Cooperation:

• CARICOM central bank coordination

• Central American central bank associations

• Bilateral central bank agreements

• Cross-border payment system development

• Technical assistance and capacity building

International Standards:

• Basel III capital adequacy framework

• FATF AML/CFT 40 Recommendations

• CPMI/IOSCO payment system principles

• IMF SDDS data dissemination standards

Geography and Jurisdiction Notes

Important Departments and Divisions

Key Public Resources

Central Bank Address:

Central Bank of Belize

Gabourel Lane

Belmopan

Belize

Official Website: https://www.centralbank.org.bz/

Key Departments:

• Governor's Office: [email protected]

• Monetary Policy: [email protected]

• Banking Supervision: [email protected]

• Foreign Exchange: [email protected]

• AML/CFT: [email protected]

• Payment Systems: [email protected]

• International Relations: [email protected]

• Credit Information System: [email protected]

General Inquiries: [email protected]

Notes on Naming and Language